Theo Maye
Business Law
Professor Winkler
09/26/2022
Jones (Plaintiff) v. Star Credit Corporation (Defendant)
Supreme Court of New York 298 N.Y.S.2d 264 (1969)
Facts:
The Joneses, who were welfare recipients, agreed to purchase a freezer for $900 as the result of
a sales person’s visit to their home. In addition to the purchase price of $900, the Joneses were
charged time credit charges, credit life insurance, credit property insurance and sales tax. As a
result, the total price for the refrigerator at the time of purchase was $1,234. Later, the Joneses,
who had made payments totalling $619, brought a suit in a New York state court to have the
purchase contract declared unconscionable under the Uniform Commercial Code (UCC). At trial,
the freezer was found to have a maximum retail value of approximately $300.
Issue:
Under the circumstances of this case, is the sale of this freezer unit unconscionable as a matter of
law?
Answer:
Yes, the court decided that the contract was not enforceable and reformed the contract so that no
further payments were required.
Reasoning:
The very limited financial resources of the purchaser which was known to the sellers at the time
of the sale along with the value disparity led to the conclusion that knowing advantage was taken
of the plaintiffs. The excessive price and unequal bargaining power meant that the contract was
deemed unconscionable.