McGowen v. Bush
17 Tex. 195 (1856)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
A contract is voidable for duress if it was entered into under a threat of great and irreparable loss of property, particularly when the party making the threat is insolvent and unable to respond in damages for the loss.
Facts:
- Bush, an elderly man, was living in a house with Saunders and a woman Saunders claimed was his wife, Emily.
- Saunders accused Bush of having an illicit relationship with Emily.
- Following the accusation, Saunders and his associates forcibly seized all of Bush's property.
- Saunders and his associates threatened Bush with physical violence (being tied to a tree and whipped) and declared they would retain his property until he submitted to their demands.
- Under fear of bodily harm and the permanent loss of his property, Bush signed a promissory note for a large sum of money payable to Saunders.
- Saunders was insolvent and had no financial ability to compensate Bush for the loss of his property had the threats been carried out.
- Saunders later endorsed the note to McGowen.
- McGowen was an active participant in the events coercing Bush and had full knowledge of the circumstances under which the note was created.
Procedural Posture:
- McGowen filed suit against Bush in a trial court to enforce a promissory note.
- Bush asserted the affirmative defenses of duress, lack of consideration, and fraud.
- The trial court rendered a judgment in favor of the defendant, Bush.
- McGowen, as the appellant, appealed the trial court's judgment to the appellate court.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does a threat of great and irreparable loss of property, made by a person who is unable to respond in damages, constitute duress sufficient to render a promissory note voidable?
Opinions:
Majority - Lipscomb, J.
Yes, a threat of great and irreparable loss of property, made by a person unable to respond in damages, constitutes sufficient duress to render a promissory note voidable. The traditional common law rule that duress requires fear of life or limb is based on the assumption that a victim has an adequate legal remedy for property loss by suing for damages. This rationale fails when the threatener is insolvent, as any legal remedy would be meaningless. In such cases, the fear of property loss can be as coercive as a threat of physical violence, and a contract entered into under such compulsion is unenforceable. Furthermore, the evidence strongly indicated that the note was procured through a fraudulent conspiracy and lacked any valid legal consideration, as there was no proof that Saunders and the woman were actually married.
Analysis:
This decision marks a significant evolution in the common law doctrine of duress in Texas, expanding it beyond threats of physical harm to include economic duress. By carving out an exception to the traditional rule for cases where the threatener is insolvent, the court recognized that the adequacy of a legal remedy is a crucial factor. This ruling established a more practical and equitable standard, acknowledging that threats to property can be just as coercive as physical threats when the victim has no realistic path to recovery. The case sets a precedent for courts to look beyond rigid common law categories and assess the actual coercive effect of a threat in the context of the parties' circumstances.
