economic duress

How does Economic Duress affect a contract?

Economic duress is a legal concept that arises in the context of contract law. It refers to a situation where one party to a contract is forced to enter into or modify the terms of a contract due to economic pressure or coercion exerted by the other party. The party claiming economic duress typically has no reasonable alternative but to agree to the terms imposed on them.

In order to prove economic duress, the victim must establish that the other person acted improperly or illegally. Because duress rests on pressure rather than an absence of consent, the nature of the pressure is crucial in determining whether duress has occurred. As some sorts of pressure are legitimate, you must show that the pressure was unlawful.

The victim should also establish that improper or illegal conduct caused them to be afraid of economic hardship and the fear of hardship prevented him or her from engaging in a commercial agreement with free will.


To win a case, you must generally establish the following elements:

  1. Unlawful or wrongful conduct: The party alleging economic duress must show that the other party engaged in some form of wrongful behaviour or acted unlawfully. This can include threats, blackmail, fraud, or other coercive tactics. See S.P.D.C.N. Ltd. v. Nwawka (2003) 6 NWLR (Pt. 815) 184, C.C.C. ThriftCredit Society v. Ekpo (2001) 17 NWLR (Pt. 743) 649.
  2. Lack of reasonable alternatives: The party under duress must demonstrate that they had no meaningful choice but to agree to the contract or modify its terms. They must show that they were facing financial hardship or other circumstances that left them with no viable alternatives.
  3. Causation: There must be a direct link between the wrongful conduct of the other party and the coerced agreement. The party alleging economic duress must show that the wrongful behaviour directly led to their acceptance of the contract or modification.

If economic duress is successfully proven, the affected party may seek remedies such as rescission (cancelling the contract), damages, or the enforcement of the contract under revised terms. However, it’s important to note that the specific legal standards and remedies for economic duress can vary depending on the jurisdiction and the particular facts of the case. It is advisable to consult with a legal professional for guidance tailored to your specific situation.