Jones v. Star Credit Corp.

59 Misc. 2d 189, 298 N.Y.S.2d 264 (Sup. Ct. 1969)

 

RULE:

The meaningfulness of choice essential to the making of a contract can be negated by a gross inequality of bargaining power.

FACTS:

Plaintiffs, husband and wife welfare recipients, agreed to purchase a home freezer unit from defendant retailer for $ 900. With the addition of time credit charges, credit life insurance, credit property insurance, and sales tax, the purchase price totaled $ 1234. Plaintiffs paid $ 619 toward their purchase, but defendant claimed that with various added credit charges, there was a balance due of $ 819. The trial court established that the freezer unit, when purchased by plaintiffs, had a maximum retail value of approximately $ 300.

ISSUE:

Does the sale of a freezer unit having a retail value of $300 for $900 unconscionable?

ANSWER:

Yes.

CONCLUSION:

The court found that, under the circumstances, the sales agreement was unconscionable within the meaning of the Uniform Commercial Code, U.C.C. § 2-302 (1964). The court held that defendant was amply compensated, and that the sales agreement was to be reformed and amended by changing the payments called for therein to equal the amount already paid by plaintiffs.

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