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BCL Law Notes Restitution of Unjust Enrichment Notes

Duress Notes

Updated Duress Notes

Restitution of Unjust Enrichment Notes

Restitution of Unjust Enrichment

Approximately 91 pages

A comprehensive guide to some of the key topics in the Restitution of Unjust Enrichment module taught on the BCL (but would also be useful for other similar courses).

It includes case summaries, various academic positions and a thorough analysis of some of the key debates within the topic in an easy digestible manner.

It focuses on contributions to this area of law from Andrew Burrows, Graham Virgo and Peter Birks, amongst others. ...

The following is a more accessible plain text extract of the PDF sample above, taken from our Restitution of Unjust Enrichment Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:

DURESS

TWO-STAGE TEST

  1. Leading HL cases on duress (The Universe Sentinel and The Evia Luck) show that there is a 2 stage test for restitution:

  1. the pressure/threat was illegitimate. This is an objective inquiry into the quality of the threat; and

  2. the payment (or rendering of a benefit in kind) was caused by that threat. This is a subjective investigation into the claimant’s state of mind

CLEARING UP A FEW BAD VIEWS

  1. Relationship to Mistake

  1. Birks saw duress as being similar to mistake in that they both relate to impaired consent. However, unlike mistake (which only consider’s the claimant), duress considers the conduct of the person exerting the duress as well as the effect on the claimant. In other words, as Burrows says, one cannot have ‘unilateral duress’

  1. Defences that aren’t so

  1. Sometimes suggested that it is a defence to restitution for duress that the claimant paid ‘in submission to an honest claim’ (Woolwich v IRC)

  2. Burrows says that this is vague. Probably best viewed as synonymous with saying that causation has not been satisfied or that a threat to sue is not illegitimate

  1. Duress has to be tortious

  1. Despite what Lord Scarman said in The Universe Sentinel, duress doesn’t have to be tortious to constitute duress in the context of unjust enrichment AS CONFIRMED BY

  2. Lord Goff in The Evia Luck

  1. Duress Constitutes Overborne Will

  1. The person under duress still intends D to have the money. So their will is not overborne. The objection is rather that C does not reach that decision freely but rather under illegitimate pressure

  1. Third Parties

  1. Burrows says that despite no cases confirming this, in principle duress can be invoked against a third party who has not itself exerted the duress

  2. This makes it abundantly clear that restitution for duress is not concerned with reprehensible conduct of D

  1. Benefits in Kind

  1. Cases have only acknowledged so far where duress in relation to money HOWEVER

  2. In principle can have duress for benefit in kind. Plus, the fact that D demanded it overcomes subjective devaluation

MAIN HEADS OF ILLEGITIMATE PRESSURE

  1. Lord Goff said the categories are not closed.

  2. But, these are the ones that have been recognised:

  1. duress of the person

  2. duress of goods

  3. illegitimate threats (other than by a public authority ultra vires) to support a demand for payment above what is statutorily permitted

  4. economic duress

  5. illegitimate threats to prosecute or sue or publish information

  6. illegitimate threats by public authorities made to support ultra vires demands (swallowed up by Woolwich principle though)

CLARIFYING TWO POINTS

  1. Implied threat

  1. Lord Goff in Woolwich Equitable Building Society stated that the ‘compulsion may be expressed or implied’ SO

  2. Implied threats do count

  1. Causation Test

  1. Barton v Armstrong – test for illegitimate threat only has to be ‘a reason’ for C’s conduct (not necessarily the sole or main reason)

  2. Even stated that the burden of proving a reason test was on the defendant BUT

  3. Huyton v Peter – suggested that ‘but for’ test should apply to economic duress

CONTRACTS ENTERED INTO BY DURESS

  1. Burrows essentially says there should be no separate rule for contracts entered into under duress as there are for non-contractual payments HIS REASON

  2. Duress can have an impact on whether there was consideration, thus causing difficulties in determining whether there was a contract ALTHOUGH

  3. REMEDIES: the restitutionary remedies are different though where payment was made under contract:

  1. No contract = remedy is an action for money had and received

  2. Contract = C’s remedy is rescission with a consequential repayment of the money

DURESS OF THE PERSON

  1. Barton v Armstrong

  1. FACTS: Claimant sought a declaration that the contract, which had been executed, was void on the ground that it had been induced by D threatening C with murder

  2. DECISION (Privy Council) – granted the declaration because D’s threats had been a reason for C making the contract

  1. Causation

  1. In Barton Lord Cross (giving leading judgment) referred to the ‘a’ reason test. SIMILARLY

  2. Lords Wilberforce and Simon said: ‘the illegitimate means was a reason (not the main reason, nor the predominant reason, nor the clinching reason)

  3. Also said that burden of proof was on D to prove otherwise

DURESS OF GOODS

  1. What?

  1. Where D improperly threatens not to return C’s goods or to seize them, unless C pays him money, C can recover that money, assuming causation, in an action for money had and received

  1. Astley v Reynolds

  1. This case shows that primary focus is whether C has freely chosen to pay

ECONOMIC DURESS

GENERAL

  1. Scope of doctrine is unsettled

  2. Principally includes threats to break a contract or induce another to break a contract

  3. The extent to which it extends to threatened lawful acts is uncertain

THREATS TO BREAK A CONTRACT

  1. Old Approach

  1. Pao On (Privy Council) – used to be that a threatened breach of contract was always regarded as illegitimate. Whether this constituted economic duress was then determined by considering whether C’s will was overborne. So, the old approach focused more on the causation question, rather than both illegitimate question and causation question now required

  1. Problems with this overborne will Approach

  1. C’s will isn’t overborne. He intends to give D the benefit – it’s just that he was forced into it

  2. Burrows suggests that there are two possible interpretations of what is meant by this overborne will language. He takes issue with both.

  1. Interpretation 1

  1. It refers to a more stringent causation test ie. the predominant cause

  2. Birks – critical of such a test, as its impossible to conduct such an inquiry into will

  3. Burrows – this is true of most causation tests though he says? BUT

  4. Huyton...

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