Australian Submarine Corporation v Kenefick

The Australian Submarine Corporation (ASC) sought to recover from Mr Kenefick the sum of $1,100,000, which it alleged was due under a deed of settlement. The dispute arose from a prior employment relationship between the parties, which had been the subject of litigation in the Federal Court. The present proceedings were heard in the High Court of Australia.

The High Court was required to determine whether the deed of settlement was voidable by reason of duress, and if so, whether the ASC had affirmed the deed after the duress had ceased. A further issue was whether the ASC was entitled to recover the sum claimed, notwithstanding any duress, on the basis that the deed represented a compromise of a disputed claim.

The Court held that the deed was voidable due to duress, finding that Mr Kenefick had exerted illegitimate pressure on the ASC by threatening to reveal certain information that would have been damaging to the ASC's reputation and commercial interests. However, the Court also found that the ASC had affirmed the deed after the duress had ceased, by continuing to make payments under it and by seeking to enforce it. The Court further held that the deed was a valid compromise of a disputed claim, and that the ASC was entitled to recover the sum claimed under the deed, as the compromise was not unconscionable.

The High Court ordered that the ASC was entitled to recover the sum of $1,100,000 from Mr Kenefick.