Year 12s: what will be the first way you research your future options? >>

Year 12s: what will be the first way you research your future options? >>

Year 12s: what will be the first way you research your future options? >>

What is the relationship between consideration and economic duress?

What is the relationship between consideration and economic duress?

(edited 7 years ago)

Original post by ongy

What is the relationship between consideration and economic duress?

Consideration is about ensuring that parties give something of value in the eyes of the law to support a contract they make.

One type of agreement which comes up regularly in exams is agreements to pay more for the same. Imagine I give you £10,000 to build a house by 1 December. You then come to me and say that you will not finish on time. I need you to finish on time so I say I will pay you £2,000 extra to finish by the original date. According to Williams v Roffey [1990] the agreement to pay extra is binding as long as the party promising the extra money obtains a benefit (which is any benefit really). However, and relevant to your question, it will only be binding where the promise to give more has been given freely and not a result of economic duress/suppression of the will. Put simply, if I came to you and tried to extract the extra payment from you as I knew you needed the work done and I took advantage of that then the agreement to pay more would fail as it was procured by economic duress.

One other area is part payment of debt. According to Foakes v Beer, an agreement to accept part payment is not supported by consideration unless something extra is given. However, even where there is no consideration the promise to accept less may still be upheld if the requirements of promissory estoppel are met. One such requirement is that it must be unfair for the promise maker to go back on the promise. One of the factors which dictate if it is unfair is if the person benefiting from the promise obtained the promise through duress e.g. 'Well if you don't take this money, then I'll just go bankrupt and you will get nothing'. In this example, there is duress (arguably) so it would NOT be unfair for the person making the promise to accept less to go back on their promise and sue for the whole amount.

Hope this helps.

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