Smithwick v. Whitley

Supreme Court of North Carolina · Contracts

ContractsDuressStatute of LimitationsVoluntary Paymentduressvoluntary paymentfree willunlawful act

Facts

The plaintiff paid $280 in order to obtain a deed for land from the defendant. At the time, the plaintiff was in actual possession of the land, while the defendant denied the plaintiff's title and claimed the deal had not been consummated. Rather than stand on his asserted legal rights and pursue his equities in court, the plaintiff acceded to the defendant's demand and paid the higher price. The plaintiff then sought to treat that payment as having been made under duress.

Issue

Whether the plaintiff's payment of an additional $280 to obtain a deed for land, made while he remained in possession of the land and could have asserted his rights in court, constituted duress rather than a voluntary payment.

Rule

Duress exists when one, by the unlawful act of another, is induced to make a contract or to perform or forgo some act under circumstances that deprive him of the exercise of free will. Duress commonly appears either as duress of the person, through imprisonment, threats, or irresistible force, or as duress of goods, where one must submit to an illegal exaction to recover goods wrongfully withheld. Where neither form of duress is present and the party can stand on legal rights and seek relief in court, payment made to settle the dispute is voluntary.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

In Asheville, Nora Benton agreed to buy a vacant lot from Caleb Mercer through a private sale. After Nora moved a fence onto the parcel and began using it, Caleb refused to deliver a deed unless she paid an additional $9,000, insisting the earlier arrangement was incomplete; Nora paid rather than file suit to establish her rights.

If Nora later sues to recover the extra $9,000 on a theory of duress, which is the best answer?

Explanation. Duress requires an unlawful act that induces a contract, performance, or forbearance under circumstances depriving the person of free will. The majority treated payment to obtain a deed as voluntary when the payer remained able to stand on legal rights and assert equities in court. A disputed demand over title or consummation of the transaction, without duress of the person or goods, is merely an adjustment of the dispute. (Derived from Smithwick v. Whitley (n.d.).)