Adhesion Contract

Atypeofcontract,alegallybindingagreementbetweentwopartiestodoacertainthing,inwhichonesidehasallthebargainingpowerandusesittowritethecontractprimarilytohisorheradvantage.Anexampleofanadhesioncontractisastandardizedcontractformthatoffersgoodsorservicestoconsumersonessentiallya"takeitorleaveit"basiswithoutgivingconsumersrealisticopportunitiestonegotiatetermsthatwouldbenefittheirinterests.Whenthisoccurs,theconsumercannotobtainthedesiredproductorserviceunlessheorsheacquiescestotheformcontract.

Thereisnothingunenforceableorevenwrongaboutadhesioncontracts.Infact,mostbusinesseswouldneverconcludetheirvolumeoftransactionsifitwerenecessarytonegotiateallthetermsofeveryConsumer Creditcontract.Insurancecontractsandresidentialleasesareotherkindsofadhesioncontracts.Thisdoesnotmean,however,thatalladhesioncontractsarevalid.ManyadhesioncontractsareUnconscionable;theyaresounfairtotheweakerpartythatacourtwillrefusetoenforcethem.Anexamplewouldbeseverepenaltyprovisionsforfailuretopayloaninstallmentspromptlythatarephysicallyhiddenbysmallprintlocatedinthemiddleofanobscureparagraphofalengthyloanagreement.Insuchacaseacourtcanfindthatthereisnomeetingofthemindsofthepartiestothecontractandthattheweakerpartyhasnotacceptedthetermsofthecontract.

West's Encyclopedia of American Law, edition 2. Copyright 2008 The Gale Group, Inc. All rights reserved.

adhesion contract (contract of adhesion)

n.acontract(oftenasignedform)soimbalancedinfavorofonepartyovertheotherthatthereisastrongimplicationitwasnotfreelybargained.Example:arichlandlorddealingwithapoortenantwhohasnochoiceandmustacceptalltermsofalease,nomatterhowrestrictiveorburdensome,sincethetenantcannotaffordtomove.Anadhesioncontractcangivethelittleguytheopportunitytoclaimincourtthatthecontractwiththebigshotisinvalid.Thisdoctrineshouldbeusedandappliedmoreoften,butthesamebigguy-littleguyinequitymayapplyintheabilitytoaffordatrialorfindandpayaresourcefullawyer

contract of adhesion

A contract offered intact to one party by another under circumstances requiring the second party to accept or reject the contract in total without having the opportunity to bargain over the wording. Insurance policies are contracts of adhesion and, as such, are construed strictly against the party writing them (i.e., the insurer).