There are two views on what kind of effect duress has on a contract. Initially there could only be duress to person. Gradually duress was expanded to include duress to goods and economic duress. Duress to person occurs when one party to the contract forces another to enter into contract with him through threats. In such a case, a contract would be voidable whether duress is the only reason for entering into contract or not. Duress to goods is where one person threatens to destroy or take the goods of another unless the contract is entered into.
This occurred in the case of The Sibotie 1976.Economic duress is where a party used its economic power to force the weaker party into a contractual agreement. However we need to differentiate between economic duress and acceptable commercial pressures the latter which every party experiences in the commercial world of business. There is a very thin line between acceptable and unacceptable commercial pressure. If economic duress is established then the contract would be a voidable one and the victim must set aside the contract.
This occurred in the case of The Sibotie 1976.Economic duress is where a party used its economic power to force the weaker party into a contractual agreement. However we need to differentiate between economic duress and acceptable commercial pressures the latter which every party experiences in the commercial world of business. There is a very thin line between acceptable and unacceptable commercial pressure. If economic duress is established then the contract would be a voidable one and the victim must set aside the contract.
