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ARTICLE · 18 JULY 2019

Legal Developments In Construction Law: June 2019

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A key ingredient of economic duress is illegitimate pressure but can a threat to do something lawful amount to economic duress?

United KingdomReal Estate and Construction
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1. Court of Appeal sets out red line on lawful act duress

A key ingredient of economic duress is illegitimate pressure but can a threat to do something lawful amount to economic duress? An airline gave notice to its agents of termination of their contracts for the sale of flight tickets and offered new contracts, but only on condition that the agents waived their existing claims. The claimant was very largely dependent on the ability to sell the airline's tickets and had no practical alternative to accepting the terms offered if it wished to remain in business. It accepted but subsequently claimed that this was a case of lawful act duress. But was it?

No, said the Court of Appeal. The doctrine of lawful act duress does not extend to the use of lawful pressure to achieve a result to which the person exercising pressure believes, in good faith, it is entitled, whether or not, objectively, it has reasonable grounds for that belief. Common law and equity set tight

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This Mayer Brown article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein.

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