Duress, Fraud, Mistake, Undue Influence 

In Rothermel v. Duncan, 369 S.W.2d 917 (Tex.1963), the court held that for a testament to be set aside on the grounds of undue influence, the contestant must prove: (1) the existence and exertion of an influence; (2) the effective operation of such influence so as to subvert or overpower the mind of the testator at the time of the execution of the testament; and (3) the execution of a testament which the maker thereof would not have executed but for such influence. 

Duress, like fraud, mistake, undue influence and other invalidating causes, may completely prevent the mutual assent necessary for the formation of a contract or sale, or, as is more frequently the case, may be merely a ground for allowing the avoidance of a bargain by its victim, whose expression of mutual assent was improperly obtained. According to the Restatement (Second) of Contracts, "… a party's conduct is not effective as a manifestation of his assent if he does not intend to engage in it. This … involves an application of that principle to those relatively rare situations in which actual physical force has been used to compel a party to appear to assent to a contract …. The essence of this type of duress is that a party is compelled by physical force to do an act that he has no intention of doing. He is, it is sometimes said, 'a mere mechanical instrument.' The result is that there is no contract at all, or a 'void contract' as distinguished from a voidable one." See Restatement (Second) of Contracts § 174. 

Where duress induces a contract, just as in the case of fraud, mistake, undue influence, and other invalidating causes, there is an actual and intended expression of assent by the victim to the transaction in question, though the circumstances under which the assent was obtained make it inequitable to permit the enforcement of the resulting bargain. Royal v. Goss, 154 Ala. 117, 45 So. 231 (1907). Because of this, except in the relatively rare instances discussed above, duress renders the resulting contract voidable rather than void. Restatement (Second) of Contracts §§ 174 to 176, especially 175(1). Thus, as a general principle, a party coerced into entering a contract has a right to avoid or rescind the transaction, and this is so whether the transaction remains executory or has been fully executed. Contempo Design, Inc. v. Chicago and N.E. Ill. Dist. Council of Carpenters, 226 F.3d 535 (7th Cir. 2000), cert. denied, 531 U.S. 1078, 121 S. Ct. 776, 148 L. Ed. 2d 674 (2001) (citing Restatement (Second) of Contracts § 175). 

The Restatement (Second) of Contracts specifies in broad terms the circumstances under which a contract will be deemed voidable, stating: "(1) If a party's manifestation of assent is induced by an improper threat by the other party that leaves the victim no reasonable alternative, the contract is voidable by the victim." Restatement (Second) of Contracts § 175(1).  Our Dallas business litigation lawyers represent individuals, small businesses, and entrepreneurs and can help you if you've signed a contract under duress.