John, the owner of a small software company, is negotiating a license agreement with a prospective customer. During a meeting, the customer says: "If you do not reduce your quoted price by 40 percent and sign our form contract today, we will walk away and buy from your competitor." Worried about losing the sale, John signs immediately. He later seeks to avoid the contract, alleging that he signed under economic duress. Under common-law principles, is John likely to succeed on that defense?
No. John's claim fails because any alleged duress was cured once he accepted the reduced price as part of the agreement.
Yes. Economic pressure arising from John's fear of losing revenue is enough to establish duress.
No. The customer's threat to purchase elsewhere was lawful hard bargaining, not an improper threat sufficient for duress.
Yes. The customer's insistence on a steep price cut within a short timeframe deprived John of any meaningful choice.
John is unlikely to prevail. A duress defense requires that the agreement be induced by an improper or wrongful threat that leaves the victim with no reasonable alternative. A customer's lawful threat to take its business elsewhere is hard bargaining, not an improper threat. Because the prospective customer was free to contract-or not-with John, and John retained lawful alternatives (such as declining or negotiating further), the pressure did not rise to the level of duress. Fear of losing revenue or time pressure alone does not render the contract voidable. The other answers misstate the standard: the mere existence of financial pressure, a steep price reduction, or John's later acceptance does not establish duress.
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