Explain what is meant by the term “duress”. List the elements of duress as established in the...

Explain what is meant by the term “duress”.

List the elements of duress as established in the case of Broodryk v Smuts.

Name and discuss the elements of duress. Explain what is meant by the term

“undue influence”. Discuss the case of Preller v Jordaan with

specific reference to how the elements of undue influence were derived from this case.

Name and discuss the elements of undue influence.

Name and discuss the remedies available to a claimant in terms of duress and undue influence.

Hutchison et al Chapter 4 pp. 144-150.

Broodryk v Smuts. Malilang v MV Houda Pearl. Medscheme Holdings v Bhamjee. Consol Limited t/a Consol Glass v

Twee Jonge Gezellen & Another.

Contractant forced or compelled to agree to contract.

Ilanga Wholesalers v Ebrahim:

Person who had stolen postage stamps from his employer was compelled by threat of prosecution to agree to an acknowledgment of debt.

Salter v Haskins:

Person who had committed adultery with his partner’s wife was persuaded to transfer his share of the partnership’s property to the aggrieved partner for fear of an action for damages.

Compulsion may be exercised by direct physical force, or

Indirectly by way of threat of harm.

Direct force: vis absoluta : Someone is physically overpowered in such a manner that he cannot be said to act at all.

Threat of harm: vis compulsiva (duress): Used to evoke a consenting expression of will.

The will of the contractant is who is subjected to the threat is nevertheless a valid expression of intent.

“A forced will is nevertheless a will”. The one who consents, acts, albeit in

fear. What if a prospective contractant is in

such fear that he is incapable of forming a legally relevant will?

Derived from Broodryk v Smuts. “Elements necessary to set aside a

contract on the grounds of duress”:

- Actual violence or reasonable fear. - Fear must be caused to threat of

some considerable evil to party/his family.

- Threat of imminent/inevitable evil. - Threat must be contra bonos mores. - Moral pressures must cause damage.

Compelling the other party to agree to contract by direct application of physical force OR threat of harm.

There must be actual compulsion in the eyes of the law.

Immediacy of undesirable consequences does not form part of the conduct/act.

See requirement of “reasonable fear” in textbook.

Wrongfulness is determined by the same general test which applies to misrepresentation.

Broodryk v Smuts: Act must be contra bonos mores.

Question: Is the act in itself wrongful? This may be the case where contractant is

threatened with lawful action, but to obtain a result to which the person who exerts the duress is not reasonable entitled to.

Example: Threatening someone with civil proceedings and subsequently obtaining consensus is not contra bonos mores per se.

If contractant is placed under duress by a third party, such third party must be held liable for the duress, and not the other contracting party.

Normally: deliberate act which in law constitutes an intentional act.

In case of threats of criminal prosecution, intent may not be apparent, because of the lack of knowledge of wrongfulness.

The basis of duress as a ground of rescission lies in the inability to express an intention in a free and unfettered manner.

Remedies for duress will be available only to a contractant who proves that the contract was caused by duress.

Actual damage as a result of conclusion of the contract is a prerequisite for a successful claim of damages.

Courts have expressed the elements of duress so as to include damage also where the contract was being rescinded without a claim for damages.

Actual damage need not be proved to justify rescission alone.

“Duress of goods” does not constitute a separate principle in South African law.

Threat directed at property of a contractant must be treated as threat directed at other protected interests.

Economic duress: See Medscheme Holdings-case.

Why this third ground? Contractant had been persuaded to

conclude a contract by someone who had previously acquired some influence over that person.

Main objections: Historically not part of our law. Incapable of exact definition/limitation

– leads to uncertainty. Incorporated into our law by majority

decision in Preller v Jordaan.

Grounds of restitutio in integrum in Roman-Dutch law are wide enough to cover the case…

where one person obtains an influence over another…

which weakens the latter’s resistance and makes his will pliable.

Void or voidable?

Did the person seeking to have it set aside enter into the transaction wilfully and knowingly, with the intention of bringing about legal consequences?

N.B. Be sure to read Van den Heever JA’s minority decision in this regard.

A contractant who wishes to rescind a contract on the ground of undue influence must prove:

1. That the other contractant obtained an influence over him/her.

2. That this influence weakened his powers of resistance and made his will pliable.

3. That the other contractant used this influence in an unconscionable manner to persuade him to agree to a transaction which was:

(a) to his detriment; (b) he would not have concluded if

he had enjoyed normal freedom of will.

It is uncertain whether undue influence constitutes a delict.

Act: Exercising influence over co-contractant.

Wrongfulness: Exercised in unconscionable manner.

Fault: If undue influence is considered a delict, then fault will be an element.

Causation: Rescission requires proof that contract would not have been concluded but for influence.

Undesirable result: Contract must have been to detriment of contractant.

1. Upholding contract:

Victim realises that consensus wasn’t only achieved because of the misrepresentation.

Victim would still have contracted, BUT:

- would have paid less, - claims for difference in price,

- positive malperformance by co-contractant, - he claims contractually, - he claims i.t.o. estoppel or breach of

contractual principles.

2. Rescission:

Victim claims no contract ever came into existence.

He would not have contracted had he been aware of true facts.