📖 Read the passage, then answer the questions below
A contract is voidable at the option of a party whose consent was caused by undue influence. Undue influence arises where one party is in a position to dominate the will of the other, and uses that position to obtain an unfair advantage over the other party. The doctrine protects a person whose free and independent judgement has been overborne by another party's dominant position, rather than genuinely exercised in agreeing to the contract.
A person is deemed to be in a position to dominate the will of another in several recognised situations: where a real or apparent authority exists over the other, such as an employer over an employee, or a person in a position of legal or actual authority over someone dependent on them; where a fiduciary relationship exists between the parties, such as a doctor and patient, or a guardian and ward, in which one party is bound to act in the other's interest and the other reasonably places trust and confidence in them; or where a contract is made with a person whose mental capacity is temporarily or permanently affected by age, illness, or mental or bodily distress, such that the other party is able to take advantage of this reduced capacity.
Where a dominant position is established, and the resulting transaction appears unconscionable -- meaning unfair or one-sided in a manner that a person exercising free, independent judgement would not ordinarily have agreed to -- a presumption arises that undue influence was used to obtain the transaction, shifting the burden onto the dominant party to prove affirmatively that the contract was entered into freely, with full understanding, and without the exercise of any undue influence. The dominant party may rebut this presumption by showing, for instance, that the weaker party had access to independent advice before entering the contract, or otherwise genuinely exercised free and informed judgement despite the relationship between the parties.
Mere influence, persuasion, or even strong emotional appeal, without an actual dominant position being used to secure an unfair advantage, does not amount to undue influence; the doctrine requires both a position of dominance and its actual use to procure a transaction that appears unfair or one-sided, not merely the existence of a close or influential relationship between the parties.
Question 1
Which of the following is one of the recognised situations in which a person is deemed to be in a position to dominate the will of another, according to the passage?
Question 2
Which of the following would most likely defeat a claim of undue influence, according to the passage?
Question 3
A wealthy, mentally sound individual, of full and independent judgement, voluntarily decides, entirely on his own initiative and without any pressure from anyone, to gift a valuable property to a close friend out of genuine generosity. Does this gift raise a presumption of undue influence?
Question 4
Which of the following is NOT one of the recognised situations in which a person may be deemed to hold a dominant position over another, according to the passage?
Question 5
Which of the following best describes the effect of establishing a dominant position combined with an unconscionable transaction, according to the passage?