Undue Influence (Contract Law)

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An Undue Influence (Contract Law) is a legal concept that occurs when one party exerts excessive persuasion or manipulation over another, causing them to enter into a contract that may not be in their best interest.

  • Context :
    • It can involve a relationship of trust or dominance between parties, such as family members, caregivers, or professionals.
    • It can result in contracts being declared void or voidable if proven in court.
    • It can be distinguished from duress, which involves threats or force rather than persuasion.
    • It can be particularly relevant in cases involving vulnerable individuals, such as the elderly or those with cognitive impairments.
    • It can be proven by demonstrating a power imbalance, unfair bargaining process, or unconscionable terms.
    • It can be a defense against the formation of a binding contract.
    • ...
  • Example(s):
    • Caregiver Influence, where a caregiver persuades an elderly person to change their will.
    • Professional Coercion, such as a therapist convincing a patient to invest in their real estate project.
    • Neighbor Exploitation, like a real estate developer pressuring a financially struggling retiree to sell property below market value.
    • ...
  • Counter-Example(s):
    • Fair Negotiation, where both parties have equal bargaining power and freely agree to terms.
    • Informed Consent, when a person makes a decision based on complete and accurate information without pressure.
    • Arms-Length Transaction, where parties act independently and in their own self-interest.
  • See: Duress-Induced Contract, Unconscionable Contract, Fiduciary Duty, Contractual Capacity, Voidable Contract, Contract Rescission.

References

2024a

  • (ChatGPT-OpenAI, 2024) ⇒ Prompt: Summarize the concept Undue Influence in 1- 2 paragraphs. ChatGPT (model:gpt-4o). Retrieved: 2024-12-08.
    • QUOTE: Undue influence is a legal doctrine used to challenge the fairness of certain transactions or agreements, typically in the context of wills, contracts, or fiduciary relationships. It occurs when one party exerts excessive persuasion or pressure on another, who is typically in a vulnerable position, to a degree that overpowers the latter's free will and results in an unfair advantage for the party exerting the influence. This imbalanced influence often happens in situations where there is a significant power differential or dependency, such as between a caregiver and a dependent, a lawyer and a client, or a family member and an elderly relative. Undue influence is particularly scrutinized in probate cases where the validity of a will is contested, and the testator's capacity to make independent decisions is in question.

      Legally, in cases of undue influence, the influenced party, or their representatives, can seek to have the transaction set aside or the will invalidated. The burden of proof often rests on the party alleging undue influence, who must demonstrate clear and convincing evidence of the coercion or manipulation that led to the consent being compromised. Factors considered by courts include the mental and physical condition of the influenced party, the presence of a confidential or fiduciary relationship, and any suspicious circumstances surrounding the transaction or agreement. Addressing undue influence is crucial for ensuring that decisions and agreements are made fairly and without coercion, preserving the autonomy and rights of individuals.

2024b

2024c

2024d

2024e

2024f

  • (Wikipedia, 2024) ⇒ https://en.wikipedia.org/wiki/Undue_influence Retrieved:2024-12-8.
    • Undue influence (UI) is a psychological process by which a person's free will and judgement is supplanted by that of another. It is a legal term and the strict definition varies by jurisdiction. Generally speaking, it is a means by which a person gains control over their victims' decision making through manipulation tactics and unfair pressure, typically for financial gain. Historically, UI has been poorly understood, even in some legal circles.

      Undue influence is typically perpetrated by a person who is trusted by the victim and is dependent on them for emotional and physical needs. Caregivers are often found to have unduly influenced their patients, however, anyone in a position of trust and authority over the victim (e.g. fiduciary) may be guilty. This includes the victims' attorney, accountant, nursing home attendant, or even children. UI is a process, not a single event. A manipulator may spend weeks, months, or even years before successfully unduly-influencing their victim. Anyone is susceptible to UI, but the elderly are particularly vulnerable.Perpetrators of UI operate in shadow, enacting their manipulation behind closed doors where there are no witnesses. A person being unduly influenced may become withdrawn, depressive and passive. Physical signs of abuse may include unexplained bruising, scratches, and/or broken bones. Other signs may include missing or broken dentures, prescription eyeglasses, hearing aids or other assistive devices.

      A distinction is made between the nature of capacity and undue influence. In assessing capacity, the practitioner evaluates an individual's ability to competently perform tasks (e.g., execute a will or give medical consent). These assessments give insight to the functioning of the cognitive capabilities at that moment in time. Conversely, screening for undue influence is focused on the process of events which occur over an extended period. To determine whether another person is leveraging unfair tactics on the victim, an assessment specific to undue influence is required.

      Undue influence occurs in various circumstances including, but not limited to domestic violence, hostage situations, cults, prisoners of war, and dictatorships. The common theme among these situations is the aspect of psychological manipulation. Traumatic bonding may occur between the victim and influencer, as a result, the victim may even defend the perpetrator. The effectiveness of cult tactics (e.g. love bombing) on young and healthy individuals illustrates that anyone, regardless of mental status, is a potential victim of UI under certain circumstances. Elderly Americans are living longer, and with this increased life expectancy, the prevalence of cognitive disorders associated with advanced age has also increased. A significant concentration of wealth is controlled by this aging demographic making them a potential target for exploitation. Modern families are becoming more complex and dispersed. Given these factors, the number of will contests involving undue influence is expected to increase.

2023

2014

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