Helen is a single mom, on food stamps. Her refrigerator goes out, so she contracts with a small appliance business to buy a basic refrigerator on an installment plan offered by the business, which isthe only way she can get the refrigerator right away.

The initial price of the refrigerator is $400, but by the time Helen completes all of her payments, with interest, she will have paid $2,000 for it.

If Helen isable to get a court to set aside the contract, it will be on the ground of:

A. mutual mistake

B. unconscionability

C. fraud

D. dures

The correct answer is B: unconscionability.

Explanation:

Unconscionability expresses the condition of being unconscionable. An unconscionable contract is one whereby all the terms and conditions contained therein benefit only one of the parties to the contract to such an extent that the contract turns out to be unjust, contrary to good conscience and therefore unenforceable under the law. As there are differences in the bargaining power of the parties to the contract, one of them has no choices.

If a court of law decides that a contract is unconscionable, the contract is void. As a consequence, the parties are released from their contractual obligations.

The most common example of a type of unconscionable contract is that where one of the parties is an experienced salesman and the other party is a consumer (as in the case at issue).