Judgment whether a threatened action is wrongful or not is colored by the object of the threat. If the threat is made to induce the opposite party to do only what is reasonable, the court is apt to consider the threatened action not wrongful unless it is actionable in itself. But if the threat is made for an outrageous purpose, a more critical standard is applied to the threatened action.
Plaintiffs entered into a contract for the construction of a house. They made a deposit, but the sale was never completed. The defendant eventually sold the house to a third party. The plaintiffs sued to recover their deposit alleging the defendant unilaterally terminated the contract. The trial court held for the plaintiffs. It reasoned that the progress of the building triggered the second payment, but the defendant failed to give notice of this. On appeal, the defendant claimed that the plaintiffs wrongfully pressured him with threats to resell the house to an undesirable purchaser and ruin the defendant’s business reputation.
Did the plaintiffs put undue pressure on the defendant, thereby rendering the contract unenforceable?
Maybe, the court held that further consideration would be needed to make a determination.
The court held that the defendant’s contention of duress warranted more consideration by the court. It remanded the trial court’s judgment for further analysis.