Contracts
Unconscionability
Definition
Unconscionability is a defense to contract enforcement arising when a contract or clause is so one-sided as to be oppressive. Courts evaluate both procedural unconscionability — defects in the bargaining process such as unequal bargaining power, hidden terms, or lack of meaningful choice — and substantive unconscionability — terms that are unreasonably favorable to one party. Under UCC Section 2-302, a court may refuse to enforce an unconscionable contract or sever the offending clause.
Example
A furniture store sells goods on an installment plan with a cross-collateral clause that keeps all prior purchases as security until every item is paid in full. This "dragnet" clause may be unconscionable.