Requirement of fairness in contracts for your soul or far less valuable items

September 24, 4:30 PMBusiness Law ExaminerMatthew Nelson

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An episode from the fifth Season of "The Simpsons" that I watched on DVD last night provided the inspiration for today's discussion of the requirement that the terms of any contract be fair. A segment from that season's Halloween episode involved doughnut fanatic Homer Simpson literally selling his soul to the devil in exchange for a doughnut.

All of the elements of forming a contract existed; Homer offered his soul as the consideration for a doughnut, and the devil accepted that offer and performed his duty of providing a doughnut. Although the program did not address this, one problem was that the basis of the contract was unconscionable in that eternal damnation was much too high of a price to require for even a tasty tasty doughnut. Another factor that supported the conclusion that the contract was unconscionable was that the devil was bargaining from a position of strength based on Simpson's doughnut addiction.

A court that concludes that a contract provision is much too unfair to one person who entered the contract will not allow the other person to enforce it. However, the court will allow the person who wants to enforce the contract to do so if this is possible absent the unconscionable part of that agreement. This is not so in the simple case of a "Raiders of the Lost Ark" style agreement of you give me soul, I give you doughnut.

However, a lease or other form of contract can often be saved even if it includes an unconscionable term. An example of this is a lease for an apartment in an owner-occupied building that establishes quiet hours that start at 8:00 p.m. In this case, the right to possess the apartment in exchange for the agreed-to rent is the essential portion of the contract that the landlord and the tenant entered.

If the landlord files an eviction that seeks possession of an apartment based on a tenant regularly going up and down the building's common stairs in the evenings after 8:00 p.m., the court would likely decide that the tenant could stay and would most probably require changing the start of quiet hours to no earlier than 10:00 p.m.

It is important to remember as well that anyone who enters a contract with anyone else always has a duty to treat that person fairly and to act in good faith.

My e-mail address is nelsonexaminer@gmail.com, and I appreciate the comments and questions that you folks have been sending. I welcome more feedback but remind you once again that nothing that I write can be considered legal advice or provide a basis for forming a landlord-tenant relationship.