''Atlas Express v. Kafco (Importers & Distributors) Ltd.''
989QB 833 is an
English contract law case relating to
duress
Coercion () is compelling a party to act in an involuntary manner by the use of threats, including threats to use force against a party. It involves a set of forceful actions which violate the free will of an individual in order to induce a desi ...
.
Facts
Kafco Ltd. had a contract to supply
Woolworths with baskets. They had a ‘trading agreement’ with Atlas Express for at least six months to undertake the deliveries. Atlas Express realised it had underestimated the size of cartons to be carried, so it was costing more to deliver. Kafco would not vary the price. On 18 November 1986,
Law Society Gazette
''The Law Society Gazette'' (also known as the ''Gazette'' or the ''Law Gazette'') is a British weekly legal magazine for solicitors in England and Wales published by the Law Society of England and Wales.
While it is available to buy and on su ...
, "Contract: economic distress", published 30 August 1989 Atlas sent an empty truck to Kafco, with a letter saying if a higher charge was not agreed to, the truck would leave empty. Kafco would go broke without the contract, so they "felt compelled to sign".
Later, Kafco refused to pay, and argued there was economic duress, and also no new
consideration.
[See A Burrows, ''Cases and Materials on Contract'' (2nd edn Hart 2009) 709]
Kafco also successfully argued that Atlas had given no consideration for its promise to pay more money on the basis that Atlas was merely performing an existing contractual duty
(Stilk v Myrick (1809) 2 Camp 317).
Judgment
Tucker J held there was economic duress in this situation, which meant the contract was voidable. When Kafco's Mr Armiger signed, he did so ‘unwillingly and under compulsion (...) He had no bargaining power. He did not regard it as a genuine arm’s length re-negotiation in which he had a free and equal say and, in my judgement, that view was fully justified.’ Tucker J distinguished economic duress from ‘commercial pressure, which on any view is not sufficient to vitiate consent. The borderline between the two may in some cases be indistinct.’
See also
*
English contract law
*''
Lloyds Bank Ltd. v. Bundy''
975
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*''
Williams v. Walker-Thomas Furniture Co.
''Williams v. Walker-Thomas Furniture Co.'', 350 F.2d 445 (D.C. Cir. 1965), was a court opinion, written by Judge J. Skelly Wright, that had a definitive discussion of unconscionability as a defense to enforcement of contracts in American contrac ...
'' 350 F.2d 445 (C.A. D.C. 1965)
*''
Pao On v Lau Yiu Long
''Pao On v. Lau Yiu Long'' 979UKPC 17is a contract law appeal case from the Supreme Court of Hong Kong">Court of Appeal of Hong Kong decided by the Judicial Committee of the Privy Council, concerning Consideration (law), consideration and duress ...
''
Notes
{{reflist
References
*A Burrows, ''Cases and Materials on Contract'' (2nd edn Hart 2009)
*P Birks, ‘The Travails of Duress’
990LMCLQ 342
English unconscionability case law
English duress case law
1989 in case law
1989 in British law
High Court of Justice cases