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UNDUE INFLUENCE

(A) THE ESSENCE OF UNDUE INFLUENCE AS A GROUND OF RESTITUTION

(i) Establishing Undue Influence

Undue influence is an equitable ground of restitution which applies where the defendant is in a relationship of trust and confidence or a relationship of ascendancy and dependency with the claimant,[1] and the defendant abuses that relationship to induce the claimant to transfer a benefit to him or her, or the defendant is presumed to have abused that relationship to induce the transfer of a benefit. It follows that there are two ways of establishing undue influence, by actual abuse of a relationship of influence or by presumed abuse of such a relationship.[2] Lewison has argued, extra-judicially, that there is only one type of undue influence, actual undue influence, which must be proved by the claimant with or without the aid of evidential presumptions.[3] That is correct but, if only for ease of exposition, it is helpful to distinguish between two different ways of establishing undue influence, all the time bearing in mind that there is only one single ground, namely that there is a relationship which is capable of giving rise to the necessary influence and that this influence had been unduly exerted by the defendant.[4] In Daniel v Drew[5] Ward LJ described the ‘undue’ component of undue influence as involving something being done to twist the claimant’s mind. Where undue influence is presumed, the claimant’s burden of proving that the influence exerted by the defendant was undue is assisted by reference to an evidential presumption of abuse, which will operate unless the defendant can adduce evidence to rebut it, usually by showing that the claimant had obtained independent advice.[6] The essence of establishing undue influence was helpfully summarized by Morgan J in Annulment Funding Co Ltd v Cowey:[7]

an issue as to whether there was undue influence involves an issue of fact. The party asserting that there has been undue influence can call direct evidence which supports such a finding. Alternatively, that party can call evidence of other matters which justify the inference that undue influence was used. Either way, the party is attempting to prove the fact of undue influence.

  • [1] conduct. See p 278, below.
  • [2] Allcard v Skinner (1887) 36 Ch D 145, 171 (Cotton LJ).
  • [3] K Lewison, ‘Under the Influence’ [2011] RLR 1.
  • [4] Royal Bank of Scotland plc v Etridge (No 2) [2002] 2 AC 773, 795 (Lord Nicholls); National CommercialBank (Jamaica) Ltd v Hew [2003] UKPC 51.
  • [5] [2005] EWCA Civ 507, [2005] WTLR 808, [31]. 21 Ibid. See p 263, below.
  • [6] 22 [2010] EWCA Civ 711, [50].
  • [7] 23 National Westminster Bank plc v Morgan [1985] AC 686, 705 (Lord Scarman), relying on a dictum of
 
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