National Westminster Bank plc v Morgan: Difference between revisions
←Created page with '{{Infobox Court Case | name = Natwest plc v Morgan | court = House of Lords | image = | caption = | date decided = | full name = | citations = [1985] [http:/...' |
|||
| Line 45: | Line 45: | ||
[[Category:English contract case law]] |
[[Category:English contract case law]] |
||
[[Category:House of Lords cases]] |
|||
[[Category:1985 in British law]] |
|||
[[Category:1985 in case law]] |
|||
Revision as of 05:43, 12 January 2015
| Natwest plc v Morgan | |
|---|---|
| Court | House of Lords |
| Citations | [1985] UKHL 2, [1985] AC 686, [1985] 1 All ER 821 |
| Keywords | |
| Undue influence, bank | |
National Westminster Bank plc v Morgan [1985] UKHL 2 is an EU competition law case, concerning the doctrine of undue influence.
Facts
A bank manager came to Mrs Morgan’s house to get her to sign a charge, which was going to refinance Mr Morgan’s business. She had no independent advice.
Judgment
Court of Appeal
Dunn LJ held that manifest disadvantage was not a necessary ingredient of presumed undue influence, giving the example of a solicitor buying a client’s house. But there were no cases in which there was not a manifest disadvantage. Mrs Morgan did not fully consent to the charge.[1]
House of Lords
The House of Lords held that ‘evidence that the transaction itself was wrongful in that it constituted an advantage taken of the person subjected to the influence’ was necessary. Moreover there was no confidential relationship between the wife and the manager and it never went ‘beyond the normal business relationship of banker and customer’ so no presumption could arise.
Lord Scarman said the following.[2]
The fact of an unequal bargain will, of course, be a relevant feature in some cases of undue influence. But it can never become an appropriate basis of principle of an equitable doctrine which is concerned with transactions ‘not to be reasonably accounted for on the ground of friendship, relationship, charity, or other ordinary motives on which ordinary men act’ (Lindley L.J. in Allcard v. Skinner, at p. 185). And even in the field of contract I question whether there is any need in the modern law to erect a general principle of relief against inequality of bargaining power. Parliament has undertaken the task - and it is essentially a legislative task - of enacting such restrictions upon freedom of contract as are in its judgment necessary to relieve against the mischief: for example, the hire-purchase and consumer protection legislation, of which the Supply of Goods (Implied Terms) Act 1973, Consumer Credit Act 1974, Consumer Safety Act 1978, Supply of Goods and Services Act 1982 and Insurance Companies Act 1982 are examples. I doubt whether the courts should assume the burden of formulating further restrictions.