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Jones v. Star Credit Corp.

Melissa A. Hale

ProfessorMelissa A. Hale

CaseCast "What you need to know"

CaseCast –  "What you need to know"

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Jones v. Star Credit Corp.
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    Brief Fact Summary. Plaintiffs, welfare recipients, purchased a home freezer worth $300 for $900 from a door-to-door salesman. After various other charges, the total purchase price was $1,234.80. At the time of the lawsuit, Plaintiffs had paid $619.88 and still owed $819.81 on the freezer.

    Synopsis of Rule of Law. A purchase price substantially higher than the value of an item can render the sale unconscionable as a matter of law.

    Facts. Plaintiffs bought a home freezer unit for $900 from a door-to-door salesman representing Your Shop At Home Service, Inc. After the addition of time credit charges, credit life insurance, credit property insurance, and sales tax, the purchase price totaled $1,234.80. At trial, it was established that the freezer had a maximum retail value of $300. Plaintiffs had paid $619.88 at the time of trial but still owed $819.81.

    Issue. Is the sale of a freezer unit having a retail value of $300 for $900 unconscionable as a matter of law?

    Held. Yes. The mathematic disparity between $900 and $300 is the most compelling evidence leading to the conclusion that the contract is unconscionable. Additionally, the credit charges alone exceeded the value of the freezer by more than $100, and the seller knew that the financial resources of the buyers were limited.

    Discussion. The determination of whether a contract is unconscionable should not be reduced solely to a mathematical formula, but on the facts before the court here, paying $900 for a $300 freezer constituted an unconscionable contract.


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