Also known as: unconscionability · unconscionable
Written by attorneys · grounded in primary & secondary sources — see below
Conduct that renders a contract or term unenforceable because it produces oppression or unfair surprise at the time of formation. Courts examine the setting, purpose, and effect of the bargain, including defects in the bargaining process and gross disparity in the exchange.
Ultra Precision contracted to supply specialized parts to Ulysses Maritime at a fixed low price after both sides assumed a key patent remained active. Actual production yields proved far lower than the preliminary data Ultra Precision had treated as sufficient. Enforcement would force the supplier into ruinous losses that shock the conscience.
Una Unger and Uriah Urban signed a separation agreement dividing pensions and setting modest maintenance after twelve years of marriage. A post-signing audit revealed that Uriah had substantially undervalued his government pension. The resulting imbalance in retirement security and maintenance, viewed against the parties' economic circumstances, renders the agreement unconscionable.
Select any source to read its text and confirm it supports the definition.
Uma Underwood and Ulrike Ulrich signed a premarital agreement waiving spousal support. After the marriage ended, enforcement would leave Uma eligible for public assistance because of a material change in circumstances arising after signing. The court refuses to enforce the support-waiver term.
United Bank sold a consumer appliance to Ugo Ucelli under a contract that excluded consequential damages for personal injury. The exclusion is prima facie unconscionable because the goods are consumer products and the limitation leaves the buyer without remedy for foreseeable harm.
Ultra Precision and Ulysses Maritime entered a supply contract containing a term that would require the supplier to absorb all losses from unexpectedly low yields. The court refuses to enforce the unconscionable term but enforces the remainder of the agreement after limiting its application to avoid an oppressive result.
Una Unger and Uriah Urban's separation agreement is found unconscionable because of undisclosed pension undervaluation and resulting economic disparity. The court requests a revised agreement correcting the valuation or issues its own orders allocating property, maintenance, and support consistent with the parties' actual circumstances.
Courts examine the setting, purpose, and effect of the bargain, including weaknesses in the contracting process such as fraud or lack of capacity, gross disparity in the values exchanged, and whether the term produces oppression or unfair surprise.
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Limitation of consequential damages for personal injury in consumer goods is prima facie unconscionable, while the same limitation in a purely commercial setting is not.
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The court may request the parties to submit a revised agreement or may enter its own orders for property division, maintenance, and support.
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No. The term must have been unconscionable at the time of signing, or enforcement must produce substantial hardship because of a material change arising after signing.
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Yes. The court may refuse to enforce the entire contract, enforce the remainder without the unconscionable term, or limit the application of the term to avoid an unconscionable result.
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…and undue influence, not to mention differences in economic bargaining power” to enable the courts to avoid enforcement of unconscionable provisions in long printed standardized contracts. 1 Corbin on Contracts (1950) § 128, p. 188. Freedom of contract is not such an immutable doctrine as to admit of no qualification in the…