Problem
Denise and Nathan are directors of Kitchen to Home Pty Ltd. The company operates a home delivery service for fast food. Business was very good during the global pandemic but a decrease in demand for home delivery and fierce competition from new market entrants has caused financial problems for the company. The company's accountant reviews the company's financial accounts and advises Denise and Nathan that the company does not have the funds to meet this month's interest repayment on the company loan. Denise and Nathan, on behalf of Kitchen to Home Pty Ltd, sign a loan contract with business lender Fast Loans Ltd for an additional $50,000 and use it to pay this month's interest repayment.
Denise and Nathan regret their decision to sign the loan contract. They know that they never would have borrowed the money unless they were under economic duress and they are hoping that this could be a legitimate reason to challenge the validity of the contract.
• Explain if the agreement between Kitchen to Home Pty Ltd and Fast Loans Ltd is a legally enforceable contract in three part (Introduction/Essential elements of contract and conclusion).