Overturning a Document Signed Under Duress in New York City

A document that is signed under duress can be rescinded upon filing of the appropriate action with the court with competent jurisdiction and within the period of statute of limitations. If the document signed is the last will and testament, the will can be objected to during probate on the ground that it was signed under duress.

What is Duress?

Duress is a situation where a plaintiff is coerced or forced by the defendant into acting against his will due to threats, intimidation, violence, or some other form of unlawful pressure. In the context of contracts, a document signed under duress can be set aside by the courts for being involuntarily executed.

In order to maintain an action for duress, the plaintiff must show that the threats made by the defendant were unlawful and deprived the plaintiff of the exercise of free will and the ability to act voluntarily.

If the defendant threatens to commit an act which is within the defendant’s legal rights to do, there can be no duress. For example, if the defendant tells the plaintiff to sign the document or else, the defendant would file a case against plaintiff for sole custody of their child, there can be no duress. That threat to commence litigation is within the legal rights of a person. On the other hand, if the plaintiff signed the document because of death threats to him and his family, there is duress.

Statute of Limitations for Duress

The action to rescind a contract based on duress should be made within six years from the time the cause of action accrued. But when does the cause of action accrue in duress?

The cause of action accrues from the time the contract is signed. However, in cases of duress, the period to file an action is tolled if the duress is continuing. The limitations period is tolled until the termination of the duress because the offensive conduct is regarded as a continuous wrong.

In the example above, although the cause of action accrues from the time the contract is signed, the 6-year statute of limitations does not begin until the death threats stop.

Setting aside a contract signed under duress requires the assistance of an experienced litigation lawyer. Complex issues may arise on whether or not there was duress, whether or not the threatened act was unlawful, and whether the period to file an action has expired. Should you need assistance in rescinding a contract on the ground of duress, we at the Law Offices of Albert Goodwin are here for you. We have offices in New York City, Brooklyn, NY and Queens, NY. You can call us at 212-233-1233 or send us an email at [email protected].

The Elements of Economic and Physical Duress

New York courts recognize two main categories of duress that can void a contract:

Physical duress involves threats of physical harm to the signer or to people the signer cares about. The classic example is a threat of violence if the document is not signed. Physical duress is the easiest category to identify but, in practice, less common in modern transactions than economic duress.

Economic duress involves wrongful threats that overcome the signer's free will in financial transactions. The elements are: a wrongful threat or wrongful act, that left the signer with no reasonable alternative, that actually caused the signer to enter the contract. The "no reasonable alternative" element distinguishes duress from mere hard bargaining — the signer must have had no realistic option other than signing.

Both types of duress, when proven, allow the signer to void the contract. The contract is treated as if it had never been signed (subject to equitable adjustments if the parties have partially performed).

What Is Not Duress

Many situations that feel coercive do not legally constitute duress. Some examples:

• Hard bargaining. A party demanding favorable terms and refusing to deal otherwise is not duress, even when the other party feels pressured.
• Threats to do what one has a legal right to do. Threatening to sue, to terminate a business relationship, to report a debt to credit bureaus, or to take any other action within the threatener's legal rights is generally not duress.
• Family pressure. A family member urging or pleading with another to sign is generally not duress unless the urging crosses into wrongful threats.
• Time pressure. A deadline imposed by the transaction is not duress unless it is artificially manufactured to deny the signer reasonable consideration.
• Financial necessity. A signer's financial need to make the deal is not, by itself, duress — the other side did not create the financial need.

The line between hard bargaining and duress can be subtle in some cases. Wrongful conduct on the part of the party seeking enforcement is generally required.

Duress in Estate Planning Contexts

Duress comes up frequently in estate planning challenges. Common scenarios:

Wills signed under family pressure. An elderly testator is taken to an attorney's office by one family member and signs a will that heavily favors that family member. Other family members later challenge on duress grounds. The challenge typically combines duress with undue influence (which is a related but distinct theory).

Powers of attorney signed during family conflict. A vulnerable adult signs a power of attorney that gives extensive authority to one family member, with allegations that the family member coerced the signing. These cases sometimes involve threats to withhold care or to remove the signer from their home.

Deeds signed during illness. A homeowner facing serious illness transfers the home to a family member or caregiver. Other family members later allege duress. Evidence about the homeowner's condition, the circumstances of the signing, and any threats made is critical.

Settlement agreements signed under pressure. A party to a settlement claims they were pressured to sign and now seeks to undo the settlement. Settlement agreements are particularly hard to set aside because courts generally favor finality.

Undue Influence as a Companion Theory

Duress is closely related to undue influence but the two are distinct legal theories. Duress involves wrongful threats. Undue influence involves the overriding of free will through manipulation, dependence, or improper persuasion — without necessarily requiring explicit threats.

Many estate cases involve both theories pleaded in the alternative. The contestant alleges that the signing was either coerced by threats (duress) or extracted through manipulation (undue influence) or both. The factfinder can find for the contestant on either theory and reach the same result — the document is set aside.

Burden of Proof

The party seeking to set aside a document on duress grounds carries the burden of proof. The standard is preponderance of the evidence — more likely than not — in most civil cases. The burden requires affirmative proof of:

• The threat or wrongful conduct that occurred.
• The threat's relationship to the signer's decision to sign.
• The absence of a reasonable alternative.
• The signer's protest or eventual repudiation of the contract.

The last element is sometimes overlooked. A signer who waits a long time after the duress ends before repudiating the contract may be found to have ratified it through delay or continued performance.

Tactical Considerations

Several practical considerations apply to duress claims:

Document the duress at the time. Notes, contemporaneous emails to friends, recorded statements, or witnesses to the threats are powerful evidence. Documentation after the fact is harder to credit.

Repudiate promptly. Once the duress ends, the signer should promptly repudiate the contract. Continuing to perform without protest can be treated as ratification.

Preserve evidence. Communications with the other side, particularly threats themselves, should be preserved.

Consider the practical recovery. Setting aside the contract returns the parties to their pre-contract position. If the signer received consideration that has been spent or otherwise dissipated, the practical recovery may be limited.

The Six-Year Statute and Continuing Duress

The six-year statute of limitations for duress claims is tolled while the duress continues. This rule recognizes that a victim of ongoing threats cannot reasonably be expected to seek legal relief while the threats persist. The clock starts running when the duress ends — when the threats stop, the threatening party loses power over the victim, or the victim escapes the situation.

Documenting when the duress ended is therefore important. The plaintiff should be able to identify the date or event after which they were free to act, so the court can determine whether the action was filed within the limitations period.