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Note: this blog entry gleans legal life lessons from the 1971 Gene Wilder version of Willy Wonka and the Chocolate Factory, which is not to be confused in any way with the 2005 Johnny Depp film, Charlie and the Chocolate Factory, which never taught anyone anything but how to regret the purchase price of a movie ticket.
Many folk first learn to fear contracts and their “fine print” as a child from Willy Wonka. Mr. Beauregarde, Violet’s car-salesman father, hesitates to allow Violet to sign the large wall-sized contract with ever-shrinking text size that Mr. Wonka insists each child sign prior to entering the factory, explaining to the candy man, “Don’t talk to me about contracts, Wonka; I use ‘em myself—they’re strictly for suckers.” And who could forget the dramatic office scene toward the end of the film when Grandpa Joe attempts to collect on the unlimited chocolate supply Charlie had been promised? In that scene, in response to Grandpa Joe, Mr. Wonka deftly whips out a magnifying glass and reads from the incredibly small print contained on a photocopy of the wall-sized contract, rattles off complex clauses written partially in Latin, and concludes with a thunderous “You get nothing! You Lose! Good day, sir!” While the obvious lesson to be taken from these scenes is that it’s very important you read and understand the entirety of any document you are about to sign (or safer yet, have a lawyer review it for you), there are additional lessons to be learned if we imagine a hypothetical where Charlie Bucket immediately leaves after Mr. Wonka’s outburst, Everlasting-Gobstopper in hand, and makes formal demand for his lifetime chocolate supply.
While there is no denying the power of the written agreement, it is not absolute—especially when complex, misleading, or extreme terms are involved. One such claim against the enforceability of a contract or its terms is that of unconscionability. While very difficult to successfully raise in most matters, Charlie just might have a shot in attacking parts if not the totality of the contract standing between him and his lifetime supply of chocolate. In light of Charlie’s claim of unconscionability, the court will look at the circumstances and evaluate whether substantial unfairness occurred during the formation of the contract. Unfairness can be drawn from both procedural unconscionability, such as the bargaining position of each party, and substantive unconscionability, such as the actual writing and terms.
Procedural unconscionability can be in recognized in numerous ways. Sticking with the Chocolate Factory contract, take for example the unequal bargaining power between Willy Wonka and Charlie Bucket. Wonka dealt with business on a regular basis as the owner of the candy company; Charlie, on the other hand, was a child who did not regularly conduct business nor would ordinarily be involved in interpreting and signing contracts. Charlie also could have brought forth evidence of an oral misrepresentation. Wonka explicitly told the participants that the contract was a “standard-form contract,” which is a basic ready-made contract that is preprinted and only slight additions or modifications are made to meet the current circumstances. The specific language within the contract, as we later hear him read, is far from slight. The contract was original in many aspects and Wonka’s description of the contract as “standard” and “form” could be deemed an oral misrepresentation. Another option for Charlie would be to bring to light the lack of choice and the surrounding circumstances in the bargaining process. Charlie was invited to the Factory for a tour after finding the Golden Ticket; however, once he arrived he was told unless he signed the contract he would not have been able to go in. There was no other candy factories offering a tour of this nature and, having brought his disabled grandfather at presumably great risk to Grandpa Joe’s health, Charlie had made a significant sacrifice to get there.
Substantive unconscionability also comes in various forms and may also be available for Charlie to use in fighting for his chocolate supply. For this claim, the court will look at whether there is good consideration or at the actual writing in analyzing this claim. To determine consideration, the court will search for something such as an act or forbearance that had been bargained for; there needs to be a benefit that motivates a party to agree to an inconvenience. Consideration may exist in the Chocolate Factory contract: Charlie agreed to the terms in order to gain access to the factory. As for what Charlie agreed to, the actual writing, the court may find substantive unconscionability. To be deemed unconscionable the terms can be unduly harsh, commercially unreasonable, or unfair given the existing circumstances. The contract signed by Charlie was unclear on the specific punishment regarding the ingestion of “fizzy-lifting” drinks (the “rule” he apparently broke). In addition, it was clouded with complex Latin terms and interpretation of the actual writing would have been difficult to any person, let alone a young boy. Taking everything into account, the terms could be found unfair given the totality of the circumstance and thus ruled unenforceable due to unconscionability.
While it is important to first read and understand any legal document you sign, the party that drafts the contract is not given free-reign and must draft in a reasonable way.
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