Duress may be a defense in a breach of contract action if the defendant can prove the following: Under Texas law, duress (including economic duress) is a defense to breach of contract. Duress may also exist where the plaintiff withholds or threatens to withhold something essential to the defendant’s business (like production, material, or distribution) unless the defendant enters into a new contract. For example, duress may be a defense if the plaintiff made a credible threat to harm the defendant or defendant’s family unless the defendant entered into a contract. Essentially, duress as a defense indicates that one of the parties to the contract forced the other party to enter into a contract that they would not have entered into absent the other party’s wrongful actions or threats of wrongful actions. The threat of coercion is the reason for entering into a new contract.A defendant to a breach of contract lawsuit in Texas may assert duress as a defense to both the formation of a contract and the performance of a contract. The significant party menaces to cancel the existing contract. The existing contract must be present between the parties. A contract must carry economic duress and must reveal the following: The plaintiff is required to prove these misconducts in front of the jurisdiction. It also involves a situation where one party menaces another to enter into a subcontract. This economic instability can be ignored due to no direct relation. This coercion bounds the party to conduct an unlawful act.Įconomic Duress : It occurs when one party uses excessive economic pressure to compel another to engage into a contract. Duress on goods can be claimed when one party seizes the other party's goods unless they enter into an illegal contract. This situation shifts the liability to the other party of proving them innocent. A person claiming defense of duress must prove that the other party threatened them or their goods to enter into an unlawful contract. Physical Duress : It is the threat either on a person or goods. Duress under contract broadly covers the following: Parties should rescind any wrongful act by the threat to compel manifestation. A contract under duress is voidable and stands still in the court. There must not be any defendant's benefit in action, and their involvement is mere because of coercion.ĭuress under contract arises when one party under contract is substantially powerful than the other and takes undue advantage of the position to do or force the other party to do any action without their consent. The threat must be prompt and unavoidable. The threat must be greater than the loss that the action will cause. The threat must be significant, for example, harm, injury, or death. An act can be considered as a defense under duress if the following requirements are followed: For example, a company's chartered accountant is forced on a gunpoint to sign a no-objection certificate before auditing the financial statement as true and fair. If the nurse gets arrested for stealing medicines from the pharmacy, the nurse can use the defense of necessity arising out of the critical situation.ĭefense of Duress : It is an illegal activity conducted due to coercion. For example, a hospital nurse is coerced to pick medicines from a pharmacy during an emergency where the patient is in critical condition. However, both can act as preventive defenses during jurisdiction.ĭefense of Necessity : It is conducting an illegal activity to prevent harming another person. Defense of duress sometimes creates conflict with the defense of necessity.
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