Section 30 Unconscionability

LibraryConsumer Law and Practice 2010

A court may refuse to enforce a contract (or clause in a contract) if it finds it to be "unconscionable." Johnson v. United Rys. Co. of St. Louis, 219 S.W. 38, 67 (Mo. banc 1920). Comment 1 to § 2-302 of the UCC (Uniform Commercial Code), 1A U.L.A. 5 (2004), states that the basic test of unconscionability "is whether, in the light of the general commercial background and commercial needs of the particular trade or case, the clauses involved are so one-sided as to be unconscionable under the circumstances existing at the time" of contracting. Once the issue of unconscionability is raised by parties or by the court, "the parties shall be afforded a reasonable opportunity to present evidence." Section 400.2-302(2), RSMo 2000.

The leading Missouri case interpreting the meaning of "unconscionability" under the UCC is Funding Systems Leasing Corp. v. King Louie International, Inc., 597 S.W.2d 624, 634-35 (Mo. App. W.D. 1979). Funding Systems adopts Professor Leff's test that there must be both procedural and substantive unconscionability to trigger the UCC but that these two elements are on a sliding scale, i.e., the more procedural unconscionability present, the less substantive unconscionability there must be and vice versa. The court cites Arthur Allen Leff, Unconscionability and the Code - The Emperor's New Clause, 115 U. Pa. L. Rev. 485 (1967), and Industralease Automated & Scientific Equipment Corp. v. R.M.E. Enterprises, Inc., 58 A.D.2d 482 (N.Y. App. Div. 1977).

Two cases have examined unconscionability in the context of form contracts. An exclusion in fine print that purports to bar...

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