Rosenblatt
  • About
    • Memery Crystal
    • Investors
  • Services

    Services

    Rosenblatt is a disputes powerhouse. Competitive in the best sense, our teams provide incisive specialist expertise and collaborate closely with one another to meet our clients’ needs across the full spectrum of their activities.

    • Dispute Resolution
    • Construction, Engineering and Energy
    • Corporate Investigations
    • Debt Recovery
    • DLT, Digital Assets, and Tokenisation
    • Financial Crime
    • Financial Services
    • Insolvency & Financial Restructuring
    • International Arbitration
    • Probate & Wills
    • Serious & General Crime
    • Tax
    • Non-Contentious & Advisory
  • Insight
  • Events
  • Group Litigation
    • Amazon Legal Action
    • Property Investment Scheme Claims
    • Apple Class Action
  • Contact

Supreme Court Dismisses Legal Economic Duress Appeal

19th August 2021

Have you ever entered into a contract because you felt you had no choice, or were commercially pressured into doing so by the counterparty?

Where a person seeks to set aside a contract on the ground that it was entered into under duress, what needs to be shown to make good the claim? Must the conduct that is said to have put the person under duress have been, in itself, unlawful? If not, what are the criteria for discerning whether there was or was not duress?

While duress comprising unlawful acts, such as the threat of violence or the seizure of goods, has long been recognised, the proposition that a threat to carry out a lawful act can amount to duress has been far less clear.

Pakistan International Airline Corporation v Times Travel

In the case of Pakistan International Airline Corporation v Times Travel [2021] UKSC 40, the Supreme Court considered whether the actions of Pakistan International Airline Corporation (PIAC), in giving lawful notice of termination of an existing agency contract, constituted economic duress.

Times Travel was a small travel agency in Birmingham. PIAC was the only airline operating direct flights between England and Pakistan. In 2008, PIAC and Times Travel entered an agency agreement through which Times Travel would be a ticketing agent for PIAC. Times Travel’s business relied almost exclusively on the sale of these tickets.

In 2012, at a time when PIAC owed a significant amount in commission to Times Travel, it gave lawful notice of the termination of the agency agreement.  PIAC subsequently offered a new agency contract which contained a term stating Times Travel would waive its claims for unpaid commission under the earlier agreement. Times Travel agreed to this contract, but subsequently brought proceedings against PIAC for the unpaid commission on the basis that the new contract was signed under duress.

The Supreme Court hearing featured three interventions from interested parties, some of whom wanted the Supreme Court to rule that the tort of economic duress no longer existed or was to be abolished.

The Decision

The Court returned a divided decision, 4-1, with Lord Burrows in the minority, However, the whole panel agreed on many aspects of the doctrine. Those included that the doctrine of lawful act duress does exist (and will continue to do so).

In paragraphs 78-80 of the majority Judgment, the Supreme Court set out the three elements that must be established for a claimant to rescind a contract on the grounds of economic duress. These are:

  1. That the action, threat or pressure from the defendant was illegitimate;
  2. That the action, threat or pressure caused the claimant to enter into the new contract; and
  3. The claimant must have had no reasonable alternative to giving in to the threat or pressure.

The Court (in the majority judgment) went on to hold that “the boundaries of the doctrine of lawful act duress are not fixed and the courts should approach any extension with caution” and affirmed the general principle, namely that the law will treat as “illegitimate”, for these purposes, unconscionable conduct.

However, the court made it clear that the doctrine should not be commonly applied and Judges should be cautious when doing so. The Court rejected various alternative suggestions as to how the doctrine should work, including an approach advocated by Lord Burrows (in the minority) based on bad faith, or in other words where the defendant did not genuinely believe that it had a defence to a pre-existing claim and the defendant deliberately created or increased the claimant’s vulnerability to that demand.

On the facts of this case, the court found that while PIAC had used its position of power as a monopoly supplier of tickets, using such power did not involve reprehensible pressure which would amount to legal economic duress and therefore would not satisfy the first element. The Supreme Court also found that PIAC had not acted in bad faith when making the demands it did, and believed in good faith that it was not liable for breach of contract because of its failure to pay past commission. Accordingly, the Supreme Court dismissed the appeal.

Conclusion

Overall, the judgment reflects a narrowing of the doctrine, with the result that economic duress claims will likely be harder to win than before. It is therefore more important that parties to contracts (especially commercially weaker parties where there is an imbalance in the bargaining positions) have fuller and more robust protection in the contract itself.

Authors

Simon Walton, Partner (simon.walton@rosenblatt-law.co.uk)

Ben Siskind, Solicitor (ben.siskind@rosenblatt-law.co.uk)


We at RBG Holdings/Rosenblatt support and encourage free/independent thinking in relation to issues which are sometimes considered to be controversial subject matters. However, the views and opinions of the authors of articles published on our website/s do not necessarily reflect the opinions, views, practices and policies of RBG Holdings/Rosenblatt.

Post navigation

The Impact of the Covid-19 Pandemic on the Long-Term Problem of Social Mobility and the Lack of Socio-Economic Diversity in Many Workplaces. What Are the Key Issues for Employers to Consider and What Should Employers Be Doing Now?
Serious Fraud Office | Fraudster Jailed for Failing to Pay his Confiscation Order | Rosenblatt’s Financial Crime Team

Categories

  • Articles
  • News
  • Videos

Topics

  • Banking & Finance
  • Competition & Regulatory
  • Corporate
  • Dispute Resolution
  • DLT, Cryptocurrencies and Crypto Assets
  • Employment
  • Financial Crime
  • Financial Services
  • Insolvency & Financial Restructuring
  • International Arbitration
  • Investigations
  • IP/Technology/Media
  • Real Estate
  • Tax
Rosenblatt
  • +44 (0) 20 7955 0880
  • info@rosenblatt-law.co.uk

Helpful Links

  • Anti-Modern Slavery Statement
  • Complaints Policy
  • Diversity & Equality
  • Interest
  • Pricing
  • Subscribe to our Mailing List

SRA No. 820215, authorised and regulated by the Solicitors Regulation Authority.

Ce Logo
Uk Top Tier Firm 2026

Rosenblatt is a trading name of RBG Legal Services Limited, a company registered in England and Wales (with company number 13287062) and which is authorised and regulated by the Solicitors Regulation Authority under SRA No. 820215. A list of the directors of RBG Legal Services Limited, together with a list of those persons who are designated as partners of Rosenblatt, is available for inspection at the registered office of the company at 165 Fleet Street, London EC4A 2DY.

Rosenblatt uses the word “partner” to refer to a senior employee or consultant. However, Rosenblatt is not a partnership and the use of the term “partner” does not create or imply a partnership amongst or between any of its employees or consultants.

© 2025 Rosenblatt

  • Privacy Policy
  • Cookie Policy
  • Terms & Conditions

Website by Brighter*IR

link

We are using cookies to give you the best experience on our website.

You can find out more about which cookies we are using or switch them off in .

Rosenblatt
Privacy Overview

This website uses cookies so that we can provide you with the best user experience possible. Cookie information is stored in your browser and performs functions such as recognising you when you return to our website and helping our team to understand which sections of the website you find most interesting and useful.

Strictly Necessary Cookies

Strictly Necessary Cookies should be enabled at all times so that we can save your preferences for cookie settings.

If you disable this cookie, we will not be able to save your preferences. This means that every time you visit this website you will need to enable or disable cookies again.

Performance cookies

These cookies allow us to count visits and traffic so we can measure and improve the performance of our site. They help us to know which pages are the most and least popular and see how visitors move around the site.

Please enable Strictly Necessary Cookies first so that we can save your preferences!

Cookie Policy

More information about our Cookie Policy.