Unconscionability
The contract defence that voids terms that are both oppressively imposed and unreasonably one-sided.
Most states require both a procedural and a substantive element, on a sliding scale: the more oppressive the formation circumstances, the less one-sidedness is needed to invalidate, and vice versa. As a generally applicable contract defence it survives FAA preemption, which makes it the primary — and in practice almost the only — route by which mass arbitration protocols are struck down.
See also
- Procedural UnconscionabilityDefects in how the agreement was formed: oppression and surprise.
- Substantive UnconscionabilityTerms so one-sided as to shock the conscience.
- FAA PreemptionThe displacement of state law that obstructs enforcement of arbitration agreements.
- Severability ClauseA term preserving the remainder of an agreement if part is held invalid.
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