Demystifying Unconscionability: An Historical and Empirical Analysis

Abstract

The doctrine of unconscionability is encrusted with myths. First year law students are taught that the doctrine was created in the twentieth century. Unconscionability is often presented as a novel one, born in the Uniform Commercial Code’s adoption of Section 2-302 in the mid-twentieth century. Even those scholars who are willing to look a bit further afield than the twentieth century for the origins of the unconscionability doctrine typically only reach the mid eighteenth century. In addition to myths surrounding its origin, the doctrine has been presented as a dangerously vague and imprecise concept. Commentators and scholars have likewise characterized the doctrine as a license for courts to refuse, unpredictably and arbitrarily, to enforce some contracts. Some claim its application has the potential to destroy all of contract law. Beyond the fear mongering myths, another standard myth taught to first year law students is that to succeed on a claim of unconscionability a party must offer at least some proof of both procedural and substantive unconscionability. This article will thus attempt to dispel the following three myths about unconscionability: • It is a new, modern doctrine of law. • Its application is unpredictable and arbitrary. • To prevail a party must prove both procedural and substantive unconscionability. The best way to dispel myths is through facts. This article attempts to clear the clouds of confusion and fear surrounding the doctrine by turning to historical and empirical fact. Part I of this article looks to the ancient past and finds that the idea that justice, and hence the law, should grant a remedy to at least some people who enter into inequitable bargains is as old as philosophizing about justice itself (and certainly older than the mid-eighteenth century). Rather than a dangerous modern innovation, this principle of justice has ancient philosophical roots in Aristotle and ancient legal roots in Roman law. Part II of the article summarizes prior attempts to assess the doctrine of unconscionability through empirical research by summarizing the results of prior work and identifies the limited scope of those projects. Part III contains the results of the comprehensive empirical analysis of what appears to be happening in cases involving claims of unconscionability in the period 2013-2017. A comprehensive coding process was undertaken for all reported federal and state cases decided over this five-year period. The results of the data analysis of 463 federal and state cases suggest that whatever the casebooks and law review articles claim about the doctrine, its application in real courts on the ground is very predictable and simpler than a two-part requirement suggests. The article concludes with a proposal to reformulate the doctrine to conform better to both its historical roots and its application by courts in real cases.