Duress & Contract Enforcement
John Wilson • Apr 22, 2020
Duress, Fraud, Mistake, Undue Influence
Texas Courts have consistently followed the rule that, as a matter of law, there can be no duress unless: (1) there is a threat to do something that a party threatening has no legal right to do, (2) there is some illegal exaction or some fraud or deception, and (3) the restraint is imminent such as to destroy free agency without present means of protection. Brown v. Cain Chem., Inc., 837 S.W.2d 239, 244 (Tex.App.-Houston [1st Dist.] 1992, writ denied); see also Ullmer v. Ullmer, 139 Tex. 326, 162 S.W.2d 944, 947 (Tex.1942) (“it is never duress to threaten to do that which a party has a legal right to do”). A threat to do merely that which one has a legal right to do is insufficient as a foundation for duress.
Setting Aside A Last Will & Testament Based on Duress
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.
Void Contracts Versus Voidable Contracts
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.
Setting Aside A Duress Induced Contract
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).
Voidable Contract Where Assent Improperly Obtained
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.
Interview of a Child in Chambers by a Texas Court Divorces can be messy; even more so when children are involved. One pivotal question that is often asked is who will receive primary custody. The prospect of children speaking to a judge during a divorce case to help determine custody can be a controversial topic. On one hand, it aims to understand and prioritize the child's preferences and best interests. On the other hand, exposing children to legal proceedings can be emotionally taxing and stressful . When Can the Judge Talk to Children? During a nonjury trial or hearing, the court is required to privately interview any child 12 years or older, while interviewing a child under 12 is at the judge's discretion. This private interview helps convey the child's wishes regarding who should have primary custody. The judge can also conduct the interview independently or on the request of a party, amicus attorney, or attorney ad litem. While speaking to the child can help determine issues of possession, access, and parent-child relationships, it does not restrict the court’s authority to decide what’s best for them. However, in cases where a jury trial is underway, the judge is prohibited from privately interviewing the child on matters subject to a jury verdict such as which parent is granted conservatorship/primary custody. During the conversations, attorneys representing the parents, the amicus attorney, the guardian ad litem, or the child's attorney ad litem may be present. For children aged 12 and older, the court is required to record these interviews to ensure a thorough and accurate record is available as part of the overall case documentation. Inside the Judge's Playbook: What Gets Asked? The judge may ask open-ended questions about living arrangements, the child's relationship with each parent, and other aspects relevant to their well-being. Additionally, an interviewer’s nonverbal communication may not contribute to the making of a particular statement. James v. Texas DHS, 836 S.W.2d 236, 239-241, (Tex.App.—Texarkana 1992, no writ.). However, the child's testimony is just one piece of the puzzle, weighed alongside other factors such as parental behavior, home stability, and each parent's willingness to cultivate the child's relationship with the other parent. Importantly, if the judge during the interview has reasonable cause to believe that a child’s physical or mental health or welfare has been adversely affected by abuse or neglect by any person , the the judge is obligated to shall immediately make a report. Tex. Fam. Code §261.101(a).
What is a Franchise Agreement? Businesses form franchise agreements when they want to share their business ideas and ventures with other entrepreneurs looking to be independent business operators themselves. The franchise agreement is a legal contract that establishes a franchisor-franchisee relationship to expand the franchisor's entrepreneurial ideas and values. The franchisor grants the franchisee the legal right to set up and operate a franchised business consistent with the terms of the franchise agreement. Under this agreement, the franchisee gains the license to use the franchisor’s trademarks, trade dress, business systems, operational manuals, and supply sources for offering and selling the franchisor's specified products and/or services. The franchise agreement is required to be legally included as an exhibit in the franchisor’s Franchise Disclosure Document, which must be presented to potential franchisees before any franchise offerings or sales are made. The federal trade commission publishes A Consumer's Guide to Buying a Franchise which is helpful for perspective purchasers' of franchises.
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The Wilson Legal Group are Dallas attorneys that specializes in Patents, Trademarks, Copyrights, Trade Secrets, Complex Litigation, Business/Corporate Law, Family Law and Real Estate Law. At the Wilson Legal Group, our clients are our focus. Our philosophy is simple and straight-forward: Understand our clients' needs, hopes, and interests in order to help them flourish. Our staff strives to build strong relationships with our clients in order to appreciate their best interests and help them achieve their goals.
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