(C) DURESS AND THIRD PARTIES

In most cases duress will involve threats made or actual pressure exerted by the defendant who obtains a benefit as a result. But it is possible that the duress emanated from a third party and this resulted in a benefit being received by the defendant. Should this make any difference to whether the defendant is liable to make restitution to the claimant? Although this question has never been raised in any reported case, it can be answered by reference to the principles which underlie the grounds of restitution. The better view is that it should be irrelevant that the duress came from a third party. All we are concerned with is the particular effect of the threats upon the claimant’s freedom of choice to transfer a benefit to the defendant, and whether the duress was exerted by the defendant or a third party has no effect on this question. Where, however, the claimant transferred a benefit to the defendant as a result of duress exerted by a third party, the liability of the defendant to make restitution may depend on whether he or she had actual or constructive notice of the duress. This would be consistent with the cases where the claimant seeks restitution of benefits transferred as a result of a third party’s misrepresentation or undue influence.^[1]

• [1] 46 In Crescendo Management Pty Ltd v Westpac Banking Corporation (1988) 19 NSWLR 40,46, McHugh JA