Find a Contracts Case
As future business professionals, it is almost certain that you will enter into contracts that the other party will unfortunately breach or attempt to breach. Indeed, this comes up so often in business that on an almost daily basis you can find articles and stories about lawsuits involving prominent individuals or large companies, in which one side is suing the other for breach of contract, or to get out of a contract.
For this Application Problem assignment, find an article dealing with a contract dispute from the last six weeks. Share the link to the article and a 3 paragraph summary in which you explain (in complete sentences, not bullet points):
1. how you found the article and why you picked it instead of other ones
2. who are the plaintiff and defendant,
3. what was each side supposed to do under the contract,
4. what is being alleged about one party’s wrong conduct in the lawsuit, and
5. what additional information about the case you think you would need to know to predict who should win.
Don’t forget to include a link to the article so that your classmates can read it as well!
Unconscionability
All students need to complete this assignment, by answering the questions below Also, each of you will need to respond thoughtfully (at least 2-4 sentences) to at least one other students post. Your post will be worth 8 points, your response to another classmate’s post worth 2 points.
This week you learned about Unconscionability, a concept that can be used to invalidate a contract and allow someone to escape their obligations under a contract. (I’m providing a short summary below of the two types of Unconscionability that need to be proven. Your textbook readings for this week provide a more full explanation.
You’ll read about “Adhesion Contracts” which are a type of contracts that are challenged more often than other types of contracts, due to potentially unconscionability. Whether you realize it or not, you’ve all entered into an adhesion contract at some point, and most of you have probably entered into many of them. Think back to some of the adhesion contracts you’ve agreed to, and discuss one or more of those contracts that you think might have been unconscionable, and whether you think you would have been able to get out of them if you had tried. In other words, your answer should:
1. Name/explain the contract you have in mind.
2. Explain whether you think the contract was substantively unconscionable and why or why not.
3. Explain whether you think the contract was procedurally unconscionable, and why or why not. Remember
4. Then explain whether the contract was actually unconscionable and voidable due to your answers to Questions 2 and 3 above.
BACKGROUND ON UNCONSCIONABILITY
Courts can refuse to enforce a contract if they find that it is unconscionable. An unconscionable contract is a contract that is so unfair to one party that a court believes it should not be enforceable under the law. It is a contract in which one party gains no real benefit, usually because they negotiated or entered into the contract from a much weaker position than the other party. In other words, there was a major difference in bargaining power between the parties. In a lawsuit, if a court decides that a contract is unconscionable, they will typically declare the whole contract void, or limit the contract’s application to avoid an unconscionable result.
Courts created the doctrine of unconscionability to prevent unfair oppression. A person trying to get out of a contract they think is unconscionable will have to prove two things to the court. First, they must convince the court that the contract was procedurally unconscionable. Second, the court must decide that the contract was also substantively unconscionable.
A contract is procedurally unconscionable (i.e. the procedures the parties to finalize the contract were unconscionable) if there was inequality in the parties’ bargaining power, or one party was unfairly surprised by hidden terms in the contract.
A contract is substantively unconscionable (i.e. the actual terms or substance of the contract are unconscionable) if the distribution of costs/benefits in the contract is overly harsh or one-sided.
Answer preview for Find a Contracts Case
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