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Natwest Bank v Morgan [1985]

Facts

  • When in arrears, a husband and wife agreed with the bank to both sign a recovery package which also included liability for the husband’s business
  • The bank did not ask the wife to obtain independent advice and the husband was hovering around when the manager spent 5 minutes advising only the wife

Issue

  • Could the wife claim undue influence over her to set aside the re-mortgage contract

Decision

  • No, contract remained

Reasoning

  • A normal relationship between a customer and banker did not give rise to a relationship of trust and confidence. As such, the bank could not have exerted undue influence over the wife
  • Also, there was no manifest disadvantage, which was required for an undue influence claim to succeed
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