Tuesday, March 26, 2013

Ora Lee Williams v. Walker–Thomas Furniture Co. case brief

Ora Lee Williams v. Walker–Thomas Furniture Co. case brief summary
350 F.2d 445

SYNOPSIS:Appellant buyers contested a judgment from the District of Columbia Court of Appeals, which affirmed a ruling from the court of general sessions in favor of appellee furniture company in a contract case involving the issue of unconscionability.

OVERVIEW: The buyers entered into installment contracts with the furniture company for the sale of furniture. The buyers defaulted on payments that were due to the company, and the district court granted judgment in favor of the company. On appeal, the buyers contended that their contracts with the company were unenforceable due to unconscionability. After noting both that Congress had enacted D.C. Code Ann. § 2-302 (Supp. 1965) of the Uniform Commercial Code and that a court had authority to refuse to enforce a contract found to be unconscionable at the time it was made, the court reviewed the contract to consider the contract's terms in light of the general commercial background and the commercial needs of the particular trade or case.

The court noted, however, that neither the trial court nor the appellate court made findings on the possible unconscionability of the contracts, so, because the record was insufficient for the court to decide the issue as a matter of law, the cases were remanded to the trial court for further proceedings.

-Unconscionability has generally been recognized to include an absence of meaningful choice on the part of one of the parties together with contract terms which are unreasonably favorable to the other party.
-Whether a meaningful choice is present in a particular case can only be determined by consideration of all the circumstances surrounding the transaction. In many cases the meaningfulness of the choice is negated by a gross inequality of bargaining power.
-The manner in which the contract was entered is also relevant to this consideration.
-Did each party to the contract, considering his obvious education or lack of it, have a reasonable opportunity to understand the terms of the contract, or were the important terms hidden in a maze of fine print and minimized by deceptive sales practices?

OUTCOME: The court remanded the case, stating that the court could refuse to enforce a contract that it found to be unconscionable at the time it was made.

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