Universe Tankships Inc of Monrovia v International Transport Workers' Federation [1982]
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Universe Tankships Inc of Monrovia v International Transport Workers' Federation [1982] 2 All ER 67 is an English contract law case that considered issues related to duress in the context of a trade dispute.
The International Transport Workers' Federation (ITWF) had blacklisted a ship owned by Universe Tankships Inc as part of a trade dispute. To secure the release of the ship, Universe Tankships Inc. paid $6,480 into ITWF's welfare fund. ITWF admitted that this payment was an agreement procured by duress. However, ITWF argued that its actions were protected by immunity from tort under the Trade Union and Labour Relations Act 1974 Section 13.
Lord Diplock, in delivering the judgment, explained that duress does not involve a lack of knowledge of the contract terms but rather occurs when one party's apparent consent is induced by pressure that the law deems illegitimate. In such cases, the consent is treated as revocable unless affirmed either expressly or by implication after the illegitimate pressure ceases.
Lord Scarman, concurring with the majority, emphasised that duress not only renders a contract voidable but can also constitute a tort if it causes damage or loss. He identified two elements of duress: (1) pressure amounting to compulsion of the victim's will and (2) the illegitimacy of the exerted pressure. The lack of any practical choice but to submit should be proven for the first element, and for the second element, the question is whether the pressure is legitimate.
The court considered whether the payment made by Universe Tankships Inc. was connected to the terms and conditions of employment, as this would determine if it fell within the definition of a trade dispute under the Trade Union and Labour Relations Act 1974. The majority held that the payment was unrelated to the terms and conditions of employment and, therefore, was not a trade dispute within the Act. Consequently, the payment was deemed to be made under duress.
The judgment of this case highlights the court's scrutiny of the circumstances surrounding a payment to determine whether duress was present and whether it falls within the protection of trade dispute immunity.
The International Transport Workers' Federation (ITWF) had blacklisted a ship owned by Universe Tankships Inc as part of a trade dispute. To secure the release of the ship, Universe Tankships Inc. paid $6,480 into ITWF's welfare fund. ITWF admitted that this payment was an agreement procured by duress. However, ITWF argued that its actions were protected by immunity from tort under the Trade Union and Labour Relations Act 1974 Section 13.
Lord Diplock, in delivering the judgment, explained that duress does not involve a lack of knowledge of the contract terms but rather occurs when one party's apparent consent is induced by pressure that the law deems illegitimate. In such cases, the consent is treated as revocable unless affirmed either expressly or by implication after the illegitimate pressure ceases.
Lord Scarman, concurring with the majority, emphasised that duress not only renders a contract voidable but can also constitute a tort if it causes damage or loss. He identified two elements of duress: (1) pressure amounting to compulsion of the victim's will and (2) the illegitimacy of the exerted pressure. The lack of any practical choice but to submit should be proven for the first element, and for the second element, the question is whether the pressure is legitimate.
The court considered whether the payment made by Universe Tankships Inc. was connected to the terms and conditions of employment, as this would determine if it fell within the definition of a trade dispute under the Trade Union and Labour Relations Act 1974. The majority held that the payment was unrelated to the terms and conditions of employment and, therefore, was not a trade dispute within the Act. Consequently, the payment was deemed to be made under duress.
The judgment of this case highlights the court's scrutiny of the circumstances surrounding a payment to determine whether duress was present and whether it falls within the protection of trade dispute immunity.
