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Contracts

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So where, at the time of the bankruptcy, a contract which CH. VII. s. 7. relates merely to the person of the bankrupt, for example, a contract for the employment of his personal skill and labour, remains Bankrupts

and their to be executed, and cannot be executed without the co-operation

Trustees, of the bankrupt, the trustee cannot enforce such contract-at all events, unless he can procure the bankrupt to co-operate (a), although by sect. 24 (3) the bankrupt is to aid in the realisation and distribution of his property; he cannot be compelled to enhance it, nor does the section throw new duties on him ; for instance, he cannot “ be called upon to plough part of his farm, or ride his horse, or show his goods in the case of the trustee requiring him to facilitate and improve a sale of his effects” (b).

By sect. 57 of the Bankruptcy Act, 1883, the trustee may, with Contracts permission of the committee, carry on the business of the bank- carrying one rupt so far as is necessary for the beneficial winding up (c), and trade of bankin so doing may, by sect. 64, appoint the bankrupt to manage. bankrupt And in such a case persons contracting with a business so carried managing. on have a preferential right to payment in full as against the previous creditors, or if, when there is a scheme of arrangement under sect. 18, the debtor trades with their knowledge and approval (d).

SECT. 8.- Persons under Duress.

To give validity to a contract the law requires, as we have General rule

at law. said, the free assent of the party who is to become chargeable thereon: and it therefore avoids any promise extorted from him by terror or violence, whether on the part of the person to whom the promise or obligation is made, or on that of his agent (e). Contracts made in such circumstances are said to be made under duress, and duress may consist either in the abuse of legal pro- In what ceedings or actual violence to the person, or threats of violence duress may

consist. such as deprive the contractor of freewill.

So either a bond and deed or an agreement not under seal, made Criminal with prosecutor by a person in prison under a criminal charge, or

charge or

threat thereof. under threats of a criminal charge, will be voidable (f).

(a) Per Williams, J., Beckham v. 630 ; Engelback_v. Nixon (1875), L. R., Drake (1849), 2 H. L. Ca. 579.

10 C. P. 645 ; Ex parte Robertson (1873), (6) Per Lord Halsbury, L.C., in Board L. R. 8 Ch. 962 ; Ex parte Ford (1876), of Trade v. Block (1888), 13 App. Cas. 1 Ch. D. 521, C. A. ; Ex parte Bolland 570.

(1878), 9 Ch. D. 312, C. A. ; Ex parte (c) But not by way of gaining profits Allard (1881), 16 Ch. D. 505, C. A. As over a series of years, Ex parte Emmanuel to where discharged bankrupt has traded (1881), 17 Ch. D. 35, C. A., decided on and the bankruptcy is reopened, see Ex the corresponding sect. 25 of the Bank- parte Pitt (1882), 20 Ch. D. 308, C. A. ruptcy Act, 1869.

(e) i Roll. Abr. 687. (d) Troughton v. Gitley (1766), Amb. (f) Bac. Abr. and Vin Abr. tit.

CH. VII. s. 8. But where the proceedings are only quasi criminal, as for penalContracts

ties under the Stamp Act, or Trade Marks Acts, an agreement with Persons under Duress. entered into with the prosecutor will not be void on the ground Release. of duress (g); and a release, though found by a jury to have been

obtained by undue pressure, has been held effective to bar an

action for arrears of salary released by it (h). Civil proceed- But where in civil proceedings the defendant is imprisoned, an ings, not duress.

agreement entered into with the plaintiff to obtain his discharge
will not be considered as entered into under duress (i), for executio
juris non habet injuriam ; and, therefore, if a man be lawfully in
custody under the process of a Court of competent jurisdiction,
and he voluntarily enters into a contract in order to obtain his
enlargement, he will be bound thereby (k).
· And it has been held that an agreement made by a party, in
order to obtain his discharge from custody under process in a
civil action, regular in form, but where in fact the plaintiff had no
cause of action, was not void on the ground of duress (1).

Nor is a threat to make a man bankrupt or to bring an action duress so as to avoid an agreement (m); but in a person of weak mind a threat of legal proceedings may produce such terror as to

amount to duress (n). Actual

And so as to violence, or threats of violence that produce fear, violence or threats

what amount will make a duress depends on the sufferer's conthereof. dition. “It has been sometimes said that in order to avoid a

contract entered into through fear, the fear must be such as would impel a person of ordinary courage to yield to it. I do not think this an accurate statement of the law. Whenever from natural weakness of intellect, or from fear-whether reasonably entertained or not-either party is actually in a state of mental incompetence to resist pressure improperly brought to bear, there is no more consent than in the case of a person of stronger intellect and more robust courage yielding to a more serious danger. The difficulty consists not in an uncertainty of the law on the subject, but in its application to the facts of each individual case" (n).

And where an infant ward of Court who had married without leave was shown by his solicitor an order of the Court requiring him to execute a settlement, and told that he would get into

Duress; Williams v. Bayley (1866), L. R.,
1 H. L. 200; Davies v. London and Pro.
vincial Insurance Co. (1878), 8 Ch. D.
469.

(9) R. v. Southerton (1805), 6 East,
126 ; 8 R. R. 428 ; Fisher & Co. v. Apolli-
naris Co. (1875), L. R., 10 Ch. 297.

(h) Barnes v. Richards, [1902] 71 L. J., K. B. 341, per Lord Alverstone, C.J.

(i) Smith v. Monteith (1844), 13 M. &W. 427.

(k) Stepney v. Lloyd (1598), Cro. Eliz. 647 ; 1 Roll. Abr. 687 ; pl. 1, 2.

(1) Anon. (1663), 1 Lev. 68.

(m) Powell v. Hoyland (1851), 6 Ex. 67; Ex parte Hall (1882), 19 Ch. D. 580.

(n) Scott v. Sebright (1886), 12 P. D. 21, per Butt, J.

trouble if he did not execute it, which he accordingly did, it was Ch. VII. s. 8.

Contracts decided that such a settlement was executed in invitum, and there

with Persons being no power in the Court to make him execute, such settlement under Duress. was set aside at his suit on coming of age (o).

But duress of goods, i.e., where a person voluntarily agrees to Duress of pay money to recover goods, is not duress; there is a distinction gooils, &e. between duress of, or menace to, the person and duress of goods. The reason is, " the former is constraining force, which not only takes away the free agency, but may leave no room to the law for a remedy; a man, therefore, is not bound by the agreement which he enters into under such circumstances; but the fear that goods may be taken or injured does not deprive any one of his free agency who possesses that ordinary degree of firmness which the law requires all to exert " (p). It has been said, that the duress must be suffered by the party. By whom

suffered. who enters into the contract (q); and that a contract entered into by a stranger, in consideration of the discharge of a third party from duress, is void as a mere nudum pactum (r). But if an agent enter into a contract for his principal, from the same fear of the inconvenience which may arise to the principal from the latter being kept in confinement, as would affect the mind of the principal himself, such contract will be void on the ground of duress (8). So, duress to a wife will avoid a contract given under its influence by the husband; and duress to a parent will avoid a contract obtained by means thereof from a child (t). And where a bond was given by a third person, on the discharge of one who had been unlawfully impressed, conditioned for the man's being returned into custody, or in default thereof for the payment of 501., the bond was held void. For the impressing of the man was unlawful; and besides, the officer had no power to commute the services of one who had been impressed, or to discharge him in consideration of money to be paid (u).

And a Court of Equity will set aside an agreement where, Relief in although there was no duress, one of the parties has taken equity where

contract oh advantage of the situation of the other, and has used undue tained by

undue ininfluence to force an agreement from him (3).

fluence. (0) In re Leigh (1888), 40 Ch. D. 290, sect. 3, “Money had and received." C. A.

(g) See Roll. Abr. 687, pl. 6; Bac. (P) Skeate v. Beale (1841), 11 Ad. & El. Abr. Duress (B.). 983, Ex. Ch., per Lord Denman, C.J. ; (r) See Smith v. Monteith (1844), 13 and see Allee v. Backhouse (1838), 3 M. & W. 427. M. & W. 633. But although duress of (s) See Cumming v. Ince (1847), 11 goods will not avoid a contract, an action Q. B. 112. will lie to recover money paid in order to (1) 1 Roll. Abr. 687, pl. 5, 6. get possession of goods wrongfully de- (u) Pole v. Harrobin (1782), 9 East, tained. Per Cur., Wakefield v. Newbon 417, note. (1844), 6 Q. B. 276; see ante, Ch. III., (a) See note (), supra; also cases

CH. VII. s. 8. Clearly, a contract made under duress would be available in Contracts

favour of the party suffering the duress, and against the party with Persons under Duress. inflicting the same. Contract may

A man who has entered into a contract under duress, may be enforced

either affirm or avoid such contract after the duress has ceased (y); by the other party.

and if he has so voluntarily acted under it with a full knowledge Such a con- of all the circumstances, he may be held bound on the ground of tract may

be affirmed.

ratification (2). Salvage. Under the head of duress may be noticed contracts for pay

ment of services to a ship in distress, or “salvage.” Where the
contract is implied only, the terms of payment are regulated by
the Merchant Shipping Act, 1894, 57 & 58 Vict. c. 60, ss. 544–
564, sect. 547 providing for their settlement in case of dispute
by the High Court, or if the property salved or amount claimed
do not exceed 1,0001. or 3001. respectively, or if jurisdiction be
given by consent, by a County Court having Admiralty jurisdic-
diction. Where the contract is express, its terms, if unreason-
able, may be modified by the High Court, on the ground that the
contract was entered into under compulsion, and it is laid down
that the sort of pressure requisite to the interference of the Court
is less than the duress required at common law to invalidate an
agreement (a).
cited in Nerill v. Snelling (1880), 15 (z) Ormes v. Beadel (1860), 2 De G. F.
Ch. D. 679; and post, Ch. XXI.

& J. 333, App:
(y) 2 Inst. 483; Whelpdale's case (1605), (a) The Rialto, [1891] P. D. 175; The
5 Co. 119, Res. 2 ; 1 Steph. Com. 442. Mark Lane (1890), 15 P. D. 135.

CHAPTER VIII.

CONTRACTS WITH MARRIED WOMEN.

PAGE 1. Contracts binding the Wife's Separate Estate

173 (a) Antenuptial Contracts 173 (b) During Cohabitation

179 (c) Separate Trading

195 2. Contracts personally Binding... 198 (a) Effect of Divorce....

198 (b) Effect of Widowhood..... 201 3. Contracts binding the Husband 201

(a) Antenuptial Contracts 201

PAGE (1) During Cohabitation

203
(c) During Separation

208
(d) Liability after Wife's Death 213
4. Contracts between Husband and
Wife

213
(a) Before Marriage, Effect of
Marriage on...

213 (b) During Cohabitation

21+ (c) Separation Deeds

216 5. Contracts with Wife as Trustee 219

Sect. 1.Contracts binding the Wife as to Separate Estate.

(a) Antenuptial Contracts. The common law, considering that the husband took the rents Effect of and profits of his wife's realty during coverture, with a possible marriage on

antenuptial estate by the curtesy, and all her personalty absolutely, rendered debts him liable to all his wife's antenuptial debts. For these husband At Common

Law. and wife could be sued jointly, and a joint judgment recovered against husband and wife. The joint judgment could be executed by the persons of both being taken into execution, and when the wife was so taken she was only discharged as a matter of indul. gence in the discretion of the Court, when it appeared that she had no separate property out of which the judgment could be satisfied, or when there was fraud or collusion of the husband to keep her in prison (a).

But in equity, if the husband did not satisfy the wife's ante- In Equity nuptial creditors, the separate estate of the wife secured to her could be rendered liable in an action against her and her trustees to her antenuptial creditors, and judgment satisfied by equitable execution. This liability overrode her equity to a settlement (1), and could not be defeated by a settlement by her of her property on her marriage to herself for her sole and separate use (c), and

(a) See Benyon v. Jones (1846), 15 247 ; Miller v. Campbell, W. N. 1871, M. & W. 566 ; Newton v. Boodle (1847), 9 Q. B. 948 ; Ivens v. Butler (1857), 26 (C) Biscoe v. Kennedy (1762), 2 Bro. L. J., Q. B. 145.

C. C. 17, n. ; followed in Chubb v. Stretch (6) Bonner v. Bonner (1853), 17 Beav. (1870), 9 Eq. 555. 86; Barnard v. Ford (1869), L. R. 4 Ch.

P. 210.

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