THE HIGH HURDLE OF PLEA OF UNDUE INFLUENCE AS A DEFENCE

November 2025

Whether a presumption of undue influence would essentially exist between the typical “husband and wife” scenario was examined in the judgment of Deutsche Bank Aktiengesellschaft also known as Deutsche Bank AG acting through its Singapore Branch v Orient Profit Investment Limited and Energy Garden Limited [2025] HKCFI 5308. The wife pleaded undue influence to oppose the bank’s enforcement of mortgage over a property owned by the wife’s corporate vehicle for banking facilities granted to a company under the directorship of the husband and wife. The wife as surety for her husband, contended that because of the tremendous pressure, being repeated and incessant demands and pestering, exerted upon her by her husband, she signed the execution page of the mortgage not knowing what the document was. The wife alleged that her husband whisked away the document without giving a chance to read it and she also signed the mortgage without lawyer present to explain the document before her execution.

In examining the wife’s undue influence plea, the Court adjudged:

1. To establish undue influence, a defendant must show that (1) the alleged influencer had capacity to influence the defendant, (2) influence was actually exercised, (3) such exercise was undue, and (4) such exercise resulted in the impugned transaction.
2. Husband and wife typically repose mutual trust and confidence in each other. That is not enough to establish that, whenever a wife does what a husband asks her to do, that the wife acted under the husband’s undue influence. There is no automatic presumption of undue influence merely because a case involves a husband-and-wife relationship.
3. Undue influence connotes some form of impropriety. Thus, when assessing a husband’s statements or conduct, so long as such behaviour does not go beyond the bounds of what may be expected of a reasonable husband in the circumstances, the court should not characterize the same as undue influence.
4. Difficult discussions between husband and wife, even heated exchanges between them, are a fact of daily life. Such matters will not be sufficient to constitute the exertion of undue influence by the former over the latter. Something more: positive misrepresentation, excessive pressure, emotional blackmail or bullying has to be proved before the court can infer that a husband has exerted undue influence over a wife and thereby constrained the exercise of the wife’s free will.
5. Mere pressure applied by a husband to persuade a wife that an unattractive course of action may nonetheless be in their best interest or that of the family, would not justify a finding of undue influence. It must be shown that the husband’s pressure was excessive, leading to the wife’s will being overcome without her reason being persuaded.

The judgment illustrates the high hurdle of the defence of undue influence to succeed in the husband and wife scenario and there is no presumption of undue influence at all in that regard.