Cengage Advantage Books: Fundamentals of Business Law 9th Edition by Roger LeRoy Miller

تمرين 2

Jones v. Star Credit Corp.
Supreme Court of New York, Nassau County, 59 Misc.2d 189, 298 N.Y.S.2d 264 (1969).
FACTS The Joneses, the plaintiffs, agreed to purchase a freezer for $900 as the result of a salesperson's visit to their home. Tax and financing charges raised the total price to $1,234.80. At trial, the freezer was found to have a maximum retail value of approximately $300. The plaintiffs, who had made payments totaling $619.88, brought a suit in a New York state court to have the purchase contract declared unconscionable under the UCC.
ISSUE Should the law deny enforcement of this contract on the ground of unconscionability?
DECISION Yes. The court held that the contract was unenforceable as it stood, and the contract was reformed so that no further payments were required.
REASON The court relied on UCC 2-302(1), which states that if "the court as a matter of law finds the contract or any clause of the contract to have been unconscionable at the time it was made, the court may... so limit the application of any unconscionable clause as to avoid any unconscionable result." The court then examined the disparity between the $900 purchase price and the $300 retail value, as well as the fact that the credit charges alone exceeded the retail value. These excessive charges were exacted despite the seller's knowledge of the plaintiffs' limited resources. The court reformed the contract so that the plaintiffs' payments, amounting to more than $600, were regarded as payment in full.
FOR CRITICAL ANALYSIS-Social Consideration Why didn't the court rule that the Joneses, as adults, had made a decision of their own free will and therefore were bound by the terms of the contract, regardless of the difference between the freezer's contract price and its retail value?
IMPACT OF THIS CASE ON TODAY'S LAW This early case illustrates the approach that many courts today take when deciding whether a sales contract is unconscionable-an approach that focuses on "excessive" price and unequal bargaining power.