Wey Bridging Finance Limited v Adam Wayne Marlow & Anor

A commercial loan agreement is supported by consideration where consolidation of earlier loans, release of co-obligors and delayed repayment confer legal benefits on the borrower. Economic duress requires illegitimate pressure, causation and, in an economic-duress case, no reasonable alternative. Lawful-act duress has an extremely limited scope in commercial negotiations between sophisticated parties advised by solicitors. Unconscionable dealing requires an oppressive bargain, serious disadvantage and unconscientious conduct. Under the Consumer Credit Act 1974, the court assesses whether the debtor-creditor relationship is unfair, not merely whether the agreement is unfair. A debtor must plead and evidence the facts relied on. An option may be terminated for substantial breach where rights of way materially impair development.

Wey Bridging Finance Limited claimed against Adam Wayne Marlow for repayment of £1.3 million advanced under a consolidated 2019 facility, together with contractual costs and interest. It also claimed against Leverton Freehold Limited, as assignee of Leverton Garden Limited’s rights, repayment of £321,000 paid under an option agreement concerning development land.

The defendants filed no evidence. The court considered pleaded allegations of lack of consideration, duress, unconscionable dealing and an unfair relationship under the Consumer Credit Act 1974. It also considered whether leases granting rights of way breached the option and whether notice and termination were valid.

1. Claim against Mr Marlow. The 2019 Facility was supported by consideration. Consolidation reduced interest, released Mrs Marlow and LFL from earlier obligations, and delayed repayment of capital. The capital and interest were admitted or unchallenged.
2. Duress. The court applied Pakistan International Airline Corporation v Times Travel (UK) Limited [2021] UKSC 40: illegitimate pressure, causation and, for economic duress, no reasonable alternative. No illegitimate pressure was proved. Threatening lawful enforcement of outstanding debt was a commercial reality. Mr Marlow had alternatives and causation was neither pleaded nor evidenced. Lawful-act duress remains extremely limited in commercial negotiations and should develop cautiously and incrementally.
3. Unconscionable dealing. The transaction was not oppressive or overreaching. There was no evidence of serious disadvantage or knowing exploitation. Mr Marlow’s sophistication, commercial experience and access to solicitors were material.
4. Unfair relationship. Sections 140A and 140B of the Consumer Credit Act 1974 require the court first to determine whether the relationship arising from the credit agreement is unfair because of a statutory cause, and only then to consider relief. The reverse burden does not remove the debtor’s obligation to plead and prove the facts relied on. The pleading and evidence disclosed no unfairness. Alternatively, the relationship was fair.
5. Option claim. LFL’s grant of leases creating rights of way over approximately a quarter of the yard breached clause 6.1 and was substantial because it materially compromised development. No particular wording was required in the notice to rectify. LFL did not rectify, and LGL validly terminated on 27 April 2020. The assignment was effective.
6. The Claimant succeeded in full against both defendants. Unpleaded allegations and unsupported closing submissions could not alter the issues for trial.