California Real Estate Practice Exam

Generally speaking, a contract entered into under duress or threat is

1. valid

2. unenforceable

3. legally binding

4. temporarily enforceable

The correct answer is: unenforceable

A contract entered into under duress or threat is considered unenforceable because such circumstances compromise the voluntary nature of agreement between the parties. Contracts rely on the principle of mutual consent, and when one party is pressured into agreement through threats or coercion, their ability to give genuine consent is undermined. This lack of true agreement means that the contract cannot be enforced in a court of law. Courts recognize that the validity of a contract is contingent not only upon the intention to create legal relations but also upon the absence of coercion, fraud, or undue influence. Therefore, if a contract is formed under duress, any purported agreement lacks the necessary components that make a contract legally binding, rendering it unenforceable.