Unconscionable Bargains Research Articles

The HMCS Unconscionability: adrift in the Atlantic

ABSTRACT This paper traces the Canadian doctrine of unconscionability’s distant voyage in Uber Technologies v Heller 2020 SCC 16 from the familiar waters of the English ‘unconscionable bargains’ family of doctrines, found in various common law jurisdictions. Since the 19th century, those jurisdictions had included Canada. However, in this important decision of the Supreme Court of Canada, the position of the doctrine shifted significantly. Its movement can be identified as towards the American doctrine of unconscionability, a distinct doctrine not part of the English family, based rather on §2-302 of the Uniform Commercial Code. Court-watchers in the United Kingdom and other Commonwealth jurisdictions wondering whether this reinterpretation of unconscionability might represent a model for progressive reform should understand why it does not. Adrift between two doctrines with different purposes, it is insufficiently suited to serve either. Meanwhile, it may disrupt business reliance on standard form contracts, and cause tremendous contractual instability.

'Unconscionability' and the Case Against Lumping: Three Case Studies

This paper argues that unconscionability provides no good basis for arguments in favour of lumping equitable doctrines in English law. It explores three areas of equity where unconscionability has most strongly divided lumpers and splitters: undue influence and unconscionable bargains; proprietary estoppel and constructive trusts; and the ‘rule in Re Rose’ and the decision in Pennington v Waine. In relation to each discussion, the paper explains how lumpers rely on the idea of unconscionability to argue in favour of merging or expanding those established doctrines, and argues against lumping, by explaining how this distorts a proper understanding of the law.

The Unconscionable Bargains Doctrine in England and Australia: Cousins or Siblings?

In discussions concerning the modern equitable unconscionable bargains doctrine, judges and commentators often draw seamlessly from English and Australian law as though they are siblings from the same family. In reality, their doctrinal elements are substantively and substantially different, and these reflect three core points. First, English and Australian law respectively imposes a negative and positive duty on contracting parties. Secondly, the legal policy underlying equitable intervention in completed contracts is much narrower and targeted in England than it is in Australia. Thirdly, ‘unconscionability’ means different things in the two jurisdictions. Ultimately, the Australian and English iterations of the doctrine are cousins rather than siblings, which counsels caution as to how the doctrine should be approached from a comparative perspective.

‘Unconscionability’ and the case against lumping: three case studies

Abstract This article argues that unconscionability provides no good basis for arguments in favour of lumping equitable doctrines in English law. It explores three areas of equity where unconscionability has most strongly divided lumpers and splitters: undue influence and unconscionable bargains; proprietary estoppel and constructive trusts; and the ‘rule in Re Rose’ and the decision in Pennington v Waine. In relation to each discussion, the paper explains how lumpers rely on the idea of unconscionability to argue in favour of merging or expanding those established doctrines, and argues against lumping, by explaining how this distorts a proper understanding of the law.

UNDUE INFLUENCE: TOWARDS A UNIFYING CONCEPT OF UNCONSCIONABLITY?

The article argues for an assimilation of the related doctrines of undue influence and unconscionable dealings under one common umbrella of unconscionability. The interrelationship between unconscionable bargains and undue influence under English law is considered in some detail, as well as developments in other Commonwealth jurisdictions, notably, in Canada, Australia and New Zealand. After examining the views of several academic commentators, the conclusion is that such an assimilation would do much to rationalise and simplify current English law. If, however, the English courts are reluctant to undertake what is perceived to be essentially a function of Parliament in developing the law, serious thought should be given to rationalising this area of law by means of legislative intervention.

Imperious Temptations: Democratic Legitimacy and Indigenous Consent in Canada

AbstractCanadian courts and governments increasingly invoke principles of mutual consent and nation-to-nation negotiation as central to the goal of addressing colonial injustices in a democratic society. However, Canada continues to interpret its obligations according to the Crown's fiduciary obligation to merely consult and accommodate Aboriginal peoples on infringement of their rights. In this article, I argue that there are conceptual resources available within existing Canadian law and politics for reconstructing a democratic consensual resolution to the problem of Indigenous exclusion and dispossession. I demonstrate that meeting the basic threshold of mutual consent would first require Canadian institutions to abjure the imperious temptation to impose parochial standards of free, prior and informed consent. Second, the Crown would refuse to ensnare Indigenous communities in unconscionable bargains, agreements that they would not otherwise view as reasonable, fair or equitable. And finally, Canada would accept rights of jurisdiction over land rooted in vital relations of health and well-being, as well as a corollary right of refusal or veto over decisions deemed by affected parties to be unwanted.

Equity in estate litigation

Equitable claims are now increasingly being raised in estate litigation, particularly in conjunction with family provision applications. In the landmark High Court case, Bridgewater v Leahy,1 an inter vivos transfer of substantial property by an elderly grazier to his nephew was set aside on the grounds that it was an unconscionable bargain, to the extent necessary to do practical justice. The practical consequence of this was to enlarge the estate available for the testator’s widow and daughters, who had brought a family provision application against a largely depleted estate. Following Bridgewater v Leahy, the equitable doctrines of undue influence and unconscionable bargains have increasingly been alleged with a view to setting aside inter vivos transfers of property. However, other equitable actions are now also becoming intertwined with estate litigation.

Defendant-sided unjust factors

This paper will examine the structure of the defendant-sided unjust factors, by which I mean duress and undue influence. The paper first argues that undue influence is based on abuse of deferential trust placed in the defendant and duress on an illegitimate threat leading to the claimant's lack of consent. The paper distinguishes undue influence from the unconscionable bargains doctrine. The paper then models the effect of that on the claimant's intentional agency by reference to Michael Bratman's influential theory of intention. It suggests that while mistake can be modelled by way of the failure of a condition on his intention, meaning that the claimant's intention does not cover the facts as they actually turn out to be, defendant-sided factors are based on the defendant's having improperly inveigled himself into the claimant's practical reasoning. It suggests that this happens either by way of the defendant's illegitimate structuring of the claimant's choice or by way of the claimant's deferring his judgment to that of the defendant. The claimant's intentions have, in philosophical language, agential authority, but the claimant was ‘in the grip of a norm’; the essay explores what this concept might be.

Unconscionable Bargains: What are the Courts Doing?

At its most basic level, the jurisdiction setting aside unconscionable bargains seeks to prevent undue contractual advantage-taking of the “weak” by the “strong. Thus, the elderly, the sick, the simpleton, the emotionally distressed, the mentally unstable, the financially needy and such like, walk on and off stage in a parade of cases which exhibit richness both in legal principles and human interest. If frequently argued and applied in the courts, the apparent width of this jurisdiction would strongly challenge the traditional understanding of the nature of contractual obligations and have far-reaching consequences for many existing areas of contract law. The lack of certainty as to the precise target and scope of such a potentially important jurisdiction has, however, been noted frequently with concern and frustration. The aim of this thesis is first, to explain judicial action in the body of unconscionability cases along consistent and rational lines; and second, to provide a survey of the ways in which unconscionability is argued and applied in the cases.

The Proverbial Shield: Transactional Imbalance and the Doctrine of Unconscionable Bargains

The doctrine of unconscionable bargains doctrine continues to be a viable source of relief for those who have entered into inequitable agreements as a result of an opposing party’s impropriety. When compared to other jurisdictions, however, it is shown that the conditions placed by the English courts on the third Lobb requirement, that is, the claimant needing to prove “oppressive and overreaching” contractual terms, which also “shock the conscience of the court,” have constituted a shield against this form of relief, deeming the doctrine’s use ineffective within English law.

UNCONSCIONABILITY AS A UNIFYING CONCEPT IN EQUITY

This article seeks to examine the extent to which a unified concept of unconscionability can be used to rationalise related doctrines of equity, in particular, in the areas of (1) unconscionable bargains, undue influence and duress (2) proprietary estoppel (3) knowing receipt liability and (4) relief against forfeitures. The conclusion is that such a process of amalgamation may provide a principled doctrinal basis for equity’s intervention which has already found favour in the English courts.

Charter Rights and Regulation by Financial Incentives

This article challenges the conventional view that the Charter is not applicable to the protection of individuals from regulation by financial incentives. The Charter applies whenever individuals are coerced by government. This coercion can be direct and overt, as with punishment, but it can also be indirect and covert as in the case of regulation by licensing, the awarding of contracts and tax incentives. Regulation by financial incentives gives rise to the possibility of subtle coercion in the forms of clever dealing, unconscionable bargains, deceptive expectations and covert punishment. The author argues that the liberty schema of the Charter should apply when regulatory enticement is coercive and not purely facilitative.