Law School Case Brief
Dillman & Assocs., Inc. v. Capitol Leasing Co. - 110 Ill. App. 3d 335, 66 Ill. Dec. 39, 442 N.E.2d 311 (1982)
The definition of an unconscionable contract is one which no man in his senses, not under delusion, would make on the one hand, and which no fair and honest man could accept on the other. An unconscionable contract is usually improvident, wholly one-sided or oppressive. Courts are generally reluctant to use the unconscionability doctrine to rewrite the terms of contracts into which educated businessmen have entered.
Dillman and Associates, Inc. contracted with Capitol Leasing Co. to lease copying equipment. The lease contained three express warranty disclaimers. Dillman and Associates encountered performance problems with the equipment that Capitol Leasing refused to address. Dillman and Associates filed an action requesting relief from its obligations under the contract, alleging that the contract was unconscionable under Ill. Rev. Stat. ch. 26, para. 2-302 (1981), and requesting damages for nonmerchantability. The court found that the contract was unconscionable but denied nonmerchantability damages. Capitol Leasing's counterclaim for full payment under the lease was denied. Capitol Leasing appealed
Is an equipment lease entered into between two business entities, under which the lessor completely disclaims all responsibility for performance of the leased equipment, unconscionable?
The court reversed, holding that the contract was not unconscionable and defendant was entitled to payments due under the lease. The contract was entered into by sophisticated businesspersons and contained three conspicuous disclaimer notices. Dillman and Associates failed to establish that defendant did not mitigate its damages. Capitol Leasing's notice of appeal was sufficient because it adequately informed plaintiff that defendant was appealing the entire trial court judgment.
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