swarb.co.uk - law index
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Undue Influence - From: 1970 To: 1979
This page lists 6 cases, and was prepared on 21 May 2019.
Saunders (Executrix of the Will of Rose Maude Gallie, Deceased) v Anglia Building Society [1971] AC 1004; [1970] UKHL 5; [1970] 3 All ER 961; [1970] 2 WLR 1078
9 Nov 1970
HL
Lord Wilberforce, Lord Reid
Contract, Land, Undue Influence
The Appellant had signed an assignment of her lease in favour of her nephew. She said she thought the effect of it would protect her right to continue to live in the house. She now appealed rejection of her plea of non est factum. Held: The common law doctrine of non est factum has a very narrow and limited application. The transaction must be essentially different in substance or in kind from the transaction intended. The plea is available to a narrow class of persons, namely, those who are: unable to read owing to blindness or illiteracy; or permanently or temporarily unable, through no fault of their own, to have without explanation any real understanding of the purport of a particular document, whether that lack of understanding be from defective education, illness or innate incapacity.
Lord Wilberforce said: "leaving aside negotiable instruments to which special rules may apply, a person who signs a document, and parts with it so that it may come into other hands, has a responsibility, that of the normal man of prudence, to take care what he signs, which, if neglected, prevents him from denying his liability under the document according to its tenor. I would add that the onus of proof in this matter rests upon him."
Lord Reid said: "'the matter generally arises when an innocent third party has relied on a signed document in ignorance of the circumstances in which it was signed, and where he will suffer loss if the maker of the document is allowed to have it declared a nullity."
. . And "The plea cannot be available to anyone who was content to sign without taking the trouble to try to find out at least the general effect of the document. Many people do frequently sign documents put before them for signature by their solicitor or other trusted advisors without making any inquiry as to their purpose or effect. But the essence of the plea non est factum is that the person signing believed that the document he signed had one character or one effect whereas in fact its character or effect was quite different. He could not have had such a belief unless he had taken steps or been given information which gave him some grounds for his belief. The amount of information he must have and the sufficiency of the particularity of his belief must depend on the circumstances of each case."
1 Cites
1 Citers
[ Bailii ]
In re Craig, Decd [1971] Ch 95
1971
Undue Influence
Undue influence was found to have been exercised by a secretary companion over her elderly employer.
1 Citers
Specot v Ageda [1973] Ch 30
1973
Megarry J
Undue Influence
In matters relating to a breach of fiduciary duty, the matter is one of perception as well as substance.
1 Citers
Lloyds Bank plc v Bundy [1975] QB 326; [1974] 3 All ER 757
1974
CA
Lord Justice Denning MR, Sir Erich Sachs, Cairns LJ
Banking, Undue Influence, Equity
"Broadchalke is one of the most pleasing villages in England. Old Herbert Bundy, the defendant, was a farmer there. His home was at Yew Tree Farm. It went back for 300 years. His family had been there for generations. It was his only asset. But he did a very foolish thing. He mortgaged it to the bank." The defendant and his son were the banks customers over many years. He had been advised that he could not afford to give greater support to his son, but later did so by extending the guarantee, and charging his property. The Bank sought to rely on the guarantee given to a bank by a father to support his son's existing borrowing. The lending bank was found to have exercised undue influence over the customer. It was inappropriate for the father to give the guarantee because the bank manager knew the father and that thefather would rely upon him. Held: The court set out to create a general principle of relief against harsh bargains on the ground of inequality of bargaining power.
1 Citers
Burston Finance Ltd v Spierway Ltd [1974] 1 WLR 1648; [1974] 3 All ER 735
1974
ChD
Walton J
Undue Influence, Equity
The lender took a charge over a property held by a company which subsequently became void because it was not registered within the required period at Companies House. Held: A voidable charge is a valid charge unless and until set aside: "[W]here A's money is used to pay off the claim of B, who is a secured creditor, A is entitled to be regarded in equity as having had an assignment to him of B's rights as a secured creditor. It finds one of its chief uses in the situation where one person advances money on the understanding that he is to have certain security for the money he has advanced, and for one reason or another, he does not receive the promised security. In such a case he is nevertheless to be subrogated to the rights of any other person who at the relevant time had any security over the same property and whose debts have been discharged in whole or in part by the money so provided by him."
1 Citers
Honeyman's Executors v Sharp; scs 14-Mar-1978 - 1978 SC 223; [1978] ScotCS CSOH - 4; 1979 SLT 177
