Contracts Question

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Cavalier-336
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Joined: Fri Jan 27, 2017 9:34 pm

Contracts Question

Postby Cavalier-336 » Fri Sep 15, 2017 9:54 pm

One defense to contract formation is unconscionability, which some jurisdictions require two components: procedural uncon. and substantive uncon.

The first component requires some kind of "bargaining defect" such as fraud, duress, misrepresentation, etc

The second component generally must have terms so one-sided that it "shocks the conscience."

I am perplexed how these jurisdictions do this analysis because wouldn't meeting the first component be sufficient as a formation defense?

clshopeful
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Joined: Sat Oct 10, 2015 5:15 pm

Re: Contracts Question

Postby clshopeful » Sun Sep 17, 2017 12:55 pm

No, the first element doesn't need to be real fraud/misrepresentation. It's less strict than that; all you need for element #1 is something suspicious.. like a young salesman doing a 3 hour demonstration at an old lady's house and then really begging her to buy the product. This example may not meet the fraud/misrepresentation elements, but its still suspicious and is kind of like undue influence. Thats what element #1 is asking; was there something during the bargaining that seems unfair, like the party was taken advantage of? If so, and the deal itself is wildly one-sided, it can be voided for unconscionability.

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pancakes3
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Joined: Sun Jul 20, 2014 2:49 pm

Re: Contracts Question

Postby pancakes3 » Sun Sep 17, 2017 6:17 pm

Cavalier-336 wrote:One defense to contract formation is unconscionability, which some jurisdictions require two components: procedural uncon. and substantive uncon.

The first component requires some kind of "bargaining defect" such as fraud, duress, misrepresentation, etc

The second component generally must have terms so one-sided that it "shocks the conscience."

I am perplexed how these jurisdictions do this analysis because wouldn't meeting the first component be sufficient as a formation defense?


don't conflate.

you present argument 1: this contract had defects during formation due to fraud/duress/misrepresentation and was never properly formed.

you present argument 2: alternatively, this contract is unconscienable and should be set aside. it satisfies both the procedural and substantive prongs.
- it was procedurally unconscienable because...
- it was substantively unconscienble because...




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