UNDUE INFLUENCE

 UNDUE INFLUENCE

v Definition - general

The improper pressure on a person resulting in his being at a manifest disadvantage in relation to some transaction. Besides, the domination of one party over the mind of another to such a degree as to deprive the latter of the will to make an independent decision.

v Case

Morley v Loughnan (1893)

It was held that the money was obtained by the exercise and abuse of personal influence and ascendancy established and maintained for that very purpose, under a cover of religion and religious brotherhood. The defendant took possession of the whole life of the deceased and the gifts were not the result of the deceased’s own free will, but the effect of that influence and domination’.

 

v Actual Undue Influence

-no need to show the existence of any special relationship between the parties

-The most important thing is to prove actual assertion of undue inf, even though the complainant did not suffer any unfairness or disadvantages.

 

v Presumed Undue Influence

complainant must show 2 things :

-wrongdoer was in a dominant position in his relationship of trust and confidence with the complainant

-The transaction was unfair to the complainant.

-Allcard v Skinner

 

v Class 2A

-In the eyes of law, persons in certain relationship are deemed to be in a dominant position.

-For instance, a solicitor is deemed to be in a dominant position over his client.

- Rosli Darus v Mansor Hj Saad & Ong Ban Chai v Seah Siang Mong

 

v Class 2B

-if there is no relationship falling within class 2A, the complainant must prove the actual existence of relationship of trust and confidence.

-For instance, relationship of husband and wife or siblings

-Southern Bank Bhd v Abdul Raof bin Rakinan & Tate v Williamson.

 

v Obtaining an unfair advantage

Refer Section 16(1)

-second requirement to prove presumed undue inf. The complainant must show that the wrongdoer obtained unfair advantage over the complainant.

-It must demonstrate Manifest disadvantage of the complainant by the dominant influence.

-it must be a disadvantage which is so obvious to any independent and reasonable person

- For instance, unconcionable contract’ in that it was a sale at under value

- Poosathurai v Kanappa Chettiar & Polygram Records Sdn Bhd v The Search

 

v Exception to the rule

-In cases of gifts, the mere proof of the existence of the relationship between the parties is sufficient to raise the presumption of undue inf.

- Refer case Inche Noriah v Shaikh Allie bin Omar which was accepted in the case of Rosli Darus v Mansor Hj Saad.

 

v Presumption in cases of presumed Undue Influence & shifting of th burden of proof

The law raises the presumption once the complainant proves both elements such as domination and unfairness of the transaction the law raises the presumption of undue influence against the wrongdoer.

 

v Rebutting the presumption

-The transaction was the result of the free exercise  of the victim’s independent will even without showing that the victim received independent legal advice.

-The victim understood what he was doing and that was his mental act. For instance, he donor was acting independently of any influence from the done with full appreciation of what he was doing.

-Lim Kim Hua v Ho Chui Lan & Tate v Williamson

 

v Exceptions to rescission

complainant may lose his right to rescission under 3 situations:

- to a bona fide purchaser for value without notice

- affirmation ie the complainant affirmed the transaction

-laches

 

v Laches

-It means lapse of time and delay in prosecuting a claim. Court will refuse to give its aid where the plaintiff has slept upon his right and acquiesced for a great length of time.

-Saad Marwi v Chan Hwa Hua  which is the Court held that the respondent’s delay or laches was a sufficient ground to dismiss his claim.