What did the court decide in Atlas Express v Kafco?

The price increase was obtained by economic duress and lacked consideration. The variation was not enforceable; Kafco was not liable to pay the extra sums.

Why was there no consideration for the new promise?

Atlas was already bound to carry the goods under the existing contract. Doing the same duty cannot be consideration for extra payment.

What facts showed economic duress?

Atlas threatened not to load unless Kafco agreed at once. Kafco had no realistic alternative carrier and risked breaching retailer contracts.

Does it matter that Kafco paid some money later?

No. Payment under pressure does not validate an agreement obtained by duress; the variation remains unenforceable.

atlas-express-ltd-v-kafco-economic-duress-variation-no-consideration

Atlas Express Ltd v Kafco (Economic Duress & No Consideration)

Contract Law High Court (QB) 1989 Citation: [1989] 1 QB 833 Bench: QB Division Reading time: ~4–5 min

Author: Gulzar Hashmi | India | Published on 26 Oct 2025

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Quick Summary

Atlas threatened to leave the trailer unloaded unless Kafco agreed to a sudden minimum charge. Kafco had no real alternative carrier and risked breaching retailer contracts, so it signed and later paid some money. The court held the variation was obtained by economic duress and there was no consideration (Atlas was already bound to carry). The extra payment was not enforceable.

Issues

Was the new higher-price agreement signed under economic duress?
Was there consideration for Kafco’s promise to pay more?

Rules

A contract variation made by illegitimate pressure (no practical choice) is voidable for economic duress.
Performing an existing duty is not valid consideration for extra payment.
Paying under pressure does not later validate the coerced variation.

Exam Tip: Ask two questions—(1) any real alternative? (2) any fresh consideration?

Facts (Timeline)

Timeline visual for Atlas Express Ltd v Kafco facts

Oct 20, 1986: Written haulage contract at £1.10/carton until May 31, 1987.

Nov 14, 1986: Atlas demanded a £440 minimum per trailer; message said trailer would leave unloaded unless signed.

No alternative: Kafco reasonably believed no other carrier was available in time; retailer contracts at risk.

Performance & payment: Atlas delivered; Kafco paid £10,000 on Feb 2.

Mar 2: Kafco wrote that the variation was signed under duress.

Claim: Atlas sued for the balance; Kafco resisted.

Arguments

Appellant (Atlas)

New minimum price was agreed and partly paid—so enforceable.
Continued carriage amounted to fresh consideration.

Respondent (Kafco)

Signature obtained by economic duress—no practical choice.
No consideration; Atlas did only what it already owed.

Judgment (Held)

Held for Kafco. Atlas used illegitimate pressure at a critical moment. Kafco had no realistic alternative. The variation lacked consideration because Atlas was already contractually bound to carry the goods. The extra payment claim failed.

Variation set aside for economic duress.
No consideration for higher price; not enforceable.

Ratio Decidendi

A price-variation extracted by threatening non-performance when the other side has no real alternative is economic duress; and where the promisor only performs an existing duty, the variation fails for lack of consideration.

Why It Matters

Protects small businesses from last-minute price hikes.
Draws a line between hard bargaining and unlawful pressure.
Reinforces the existing duty rule on consideration.

Key Takeaways

No real alternative + threat to withhold performance → economic duress.
Doing what you already owe = no consideration for more money.
Payment under pressure doesn’t validate a coerced variation.

Mnemonic + 3-Step Hook

Mnemonic: “PRESS = Pressure, No Remedy, Existing duty, Signed, Set aside”

Pressure to sign now,
No remedy (no alternative),
Existing duty only,
Signed under strain,
Set aside in court.

3-Step Exam Hook

Was there illegitimate pressure + no practical alternative?
Was there fresh consideration for the variation?
Remedy: declare variation voidable; deny extra payment.

IRAC Outline

Issue

Is the price increase enforceable where Kafco signed under threat that the trailer would not be loaded?

Rule

Economic duress vitiates consent; performing an existing duty is not good consideration for more money.

Application

Atlas’s “no load unless you sign” left Kafco with no real choice; Atlas offered no fresh consideration beyond its original duty.

Conclusion

Variation voidable for duress and fails for lack of consideration; claim for extra sums dismissed.

Glossary

Economic Duress: Illegitimate pressure leaving no practical alternative, causing consent to a contract/variation.
Existing Duty Rule: Doing what you are already bound to do is not consideration for a fresh promise to pay more.
Variation: A change to contract terms; must be freely agreed and supported by consideration (unless under deed/statute).