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MikeSteinthalFirstEssay 4 - 23 May 2025 - Main.MikeSteinthal
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< | The Unconscionability of Unconscionability | >
> | Rights-Affecting Clauses and Consumer Contracts | | | -- By MikeSteinthal - 17 Feb 2025 | |
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< | Here is an Idea
In introductory contract law courses, students are taught that consumers are bound by the terms and conditions they agree to when they sign up for any service. This presumption is removed from reality and ultimately harmful to individuals, to the benefit of corporations. The world would be better off if we applied legal realism to this context, stopped pretending that individuals read their contracts, and stopped holding people accountable to these terms. | >
> | The Legal Fiction of Mutual Assent
Contract law rests on the bedrock principle of mutual assent: that parties are legally bound by agreements they knowingly and intentionally enter into. Mutual assent is clearly present where sophisticated business-savvy parties negotiate and agonize over every contractual provision until a mutually acceptable document is produced. This dynamic bargaining process ensures that the final contract serves the interests of both parties. Otherwise, as economically rational profit-driven actors, they would not agree to it. | | | | |
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< | Here is how I came by it
In my first semester of law school contracts course, we read a series of cases in the syllabus unit “Unconscionability.” This segment of the course was designed to provide students with an introduction to the contours of consumer adhesion contracts. In daily life, individuals are constantly purchasing goods and signing up for services. This is particularly true in the internet context, where most websites require people to create accounts in order to use them. When registering for any of these services, one undoubtedly is prompted to agree to the "terms and conditions" of that website, often clicking a small box to affirm that the new user has read through, understands, and consents to be bound to those terms and conditions. | >
> | Most consumer contracts, particularly those accompanying commercial transactions performed online, are so-called “adhesion” contracts. When a consumer purchases a product or registers for an account, they usually must agree to the seller or provider’s terms and conditions. These terms are standardized and non-negotiable, and not a product of bargaining in any meaningful sense. The consumer must decide whether assenting to the terms presents a reason to not engage in the transaction altogether. Ideally, the consumer fully understands what the terms and conditions entail for their interests, and can decide on that basis whether or not to agree. | | | | |
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< | Of course, nobody actually reads those terms and conditions. But for legal purposes, we are taught, that doesn't matter. The law here creates a "legal fiction," a departure from reality solely for legal purposes. Professor Gillis, who taught my first semester contracts class, described the fiction aptly. I will paraphrase her wonderful explanation of the legal fiction here: "The law imagines the user who just purchased their new software, or who just started registering for an online account, pausing at the step in the process where they are confronted with the terms and conditions, and must decide whether to click on the "I accept" box. Before clicking, the user prints out every last page of terms, binds them together to create a manuscript, saunters over to her armchair by her fireplace, kicks her feet up on her ottoman, lets out a sigh, and begins leafing through. She reads each page, annotating the margins, taking note of all the duties, obligations, and responsibilities contained therein. Finally, she thinks to herself, "_Am I amenable to these terms_?"; Only if that answer is a resounding “_Yes_!”, then she continues on with her account or software registration, confident in her legal situation and positioning.” | >
> | Here the law creates a “legal fiction,” an assertion accepted as true, though departing from reality, to achieve a particular goal in a legal matter. The law imagines that the user prints out every page of the terms and conditions, binds them together, and spends her afternoon reading every page. Only then does the user carefully evaluate if the contract is amenable to her interests, and only if it is, does she click “I accept.” | | | | |
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< | If that story sounds comical, it is. But it captures the state of contract law, and its presumption that users read, digest, comprehend, and affirmatively consent to be bound by the terms and conditions of every product and service they consume. | >
> | Nobody actually reads the terms and conditions. But for legal purposes, that doesn’t matter. | | | | |
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< | Here is what causes me to have confidence in this idea
In an ideal contract, the two parties to the contract, or more likely, their lawyers, fight tooth and nail over every clause. Each word is litigated, haggled, and argued over until a mutually acceptable version is produced. This bargaining negotiation ensures that the final contract serves the interests of both parties. Otherwise, as rational economic actors, they would not agree to it. | >
> | With this conception of user understanding in mind, mutual assent from the bargained-for consideration of sophisticated business entities context is translated to consumer adhesion contracts. In this way, the law ignores that consumers are not actually aware of what they are agreeing to and even if consumers were aware, unlike a corporation with a small village for a legal department, they have no meaningful ability to alter the terms. | | | | |
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< | The legal fiction in consumer contracts departs immensely from this negotiation-oriented conception of contract law. However, it binds the user to the ultimate contract just the same. There are many reasons why this is inappropriate. | | | | |
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< | Unlike in the bargained-for context, consumers ordinarily do not understand their position in the matter. Without legal training, they simply lack the ability to understand the terms of the contract itself, and do not understand their own position in these legal matters to a sufficient extent such that they could meaningfully argue on their own behalf. Consider a mandatory arbitration clause. If a consumer doesn’t understand what arbitration is and how agreeing to it restricts their opportunities, how could they possibly negotiate with a company’s legal team about it? | >
> | Issues for Rights-Affecting Clauses
Consumers who haphazardly agree to the terms and conditions are not without any redress in the event that they find themselves entering litigation. Courts have developed doctrinal tools to combat exploitative terms, most importantly unconscionability and public policy. However, Courts hesitate to label terms “unconscionable” unless they are both severely procedurally and substantively unfair. As a result, most contract terms fall well short of what one would call unconscionable or contrary to public policy, and are therefore enforceable. | | | | |
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< | Furthermore, even if a consumer had the wherewithal to understand the substance of a contract, and wanted to effectuate change to the contract’s clauses, there is an enormous power imbalance at play. Most consumers do not have the time, money, or resources of a corporation available to mobilize towards demanding better terms. | >
> | For most contractual clauses, that is not an issue. It is an issue for clauses that impact someone’s fundamental rights and means of redress, clauses that I will call “Rights-Affecting Clauses.” | | | | |
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< | Finally, if a consumer wants, or needs, to use this particular company’s product or service, they lack alternatives. In the bargained-for contract scenario, both parties negotiate with the understanding that if the scales tip too far in either direction, the other party can freely leave and find a better option elsewhere. That is not so in the consumer context. Consumers who want to use a particular product effectively must accept the company’s terms and conditions. Often, competitors will offer the same boilerplate terms and conditions, leaving the consumer with no meaningful alternative. | >
> | Mandatory arbitration clauses exemplify this problem. Courts consistently deem mandatory arbitration clauses enforceable, and thereby conscionable, across legal contexts. These clauses impact a party’s means of redress and ability to vindicate their interests in court, and are materially different from other contractual boilerplate. | | | | |
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< | There are myriad issues with this legal fiction. | >
> | Rights-Affecting Clauses should be subject to a greater notice requirement than other clauses because of this material impact on fundamental rights. | | | | |
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< | Here is where it might lead you | >
> | Adapting FRCP 23(c)(2)(B) for Contracts
To bridge the gap between the fiction of assent and the reality of consumer contracting, courts should adopt a more rigorous notice standard when it comes to these Rights-Affecting Clauses. | | | | |
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< | It is taught in introductory Contracts courses that the doctrine of unconscionability creates a protection for consumers from these adhesion contracts. Unconscionability refers to the discretionary ability for judges to evaluate whether a contract provision is so imbalanced, so detrimental to a consumer, that it must be deleted from the contract entirely. | >
> | I propose that Federal Rule of Civil Procedure 23(c)(2)(B)’s governance of notice to class members in certain class actions should serve as a model approach. Alongside requiring predominance, this rule requires that “a class action is superior to other available methods for fairly and efficiently adjudicating the controversy.” It governs another context where individuals are uniquely unable to self-advocate, and in this way aligns with consumer adhesion contracts. | | | | |
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< | Unconscionability is not an appropriate solution. It does not resolve any of the issues mentioned. All it does is create a high water mark, beyond which companies can not go. It says nothing about the vast realm of contractual clauses binding on consumers that fall short of stirring a judges’ conscience. It is unfair for consumers to be bound to the terms of enormous legal documents that they almost certainly will not read, so long as those terms do not erode substantive and procedural rights so drastically that they sufficiently tug the heartstrings of the justice system. | >
> | FRCP 23(c)(2)(B) notice for 23(b)(3) classes differs from other class actions because here the court must direct class members “the best notice that is practicable under the circumstances,” including individual notice when possible, and that the notice be in “plain, easily understood language.” For 23(b)(1) and (2) classes, the court may direct “appropriate notice.” This mandatory notification ensures that members of a certified class, whose legal rights will be affected by the ongoing suit, are aware of the action and have an opportunity to opt-out if they choose to. | | | | |
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< | Instead, this legal fiction should be eliminated in its entirety. | >
> | This standard could be adapted for contracts by requiring that when a company seeks to bind consumers to a Rights-Affecting Clause–such as arbitration clauses, jury trial waivers, or class action waivers–it must give consumers clear, individualized, and understandable notice of the clause and its consequences. This would not ensure that assent to particularly consequential terms is meaningful. | | | | |
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> | To comply with this companies would need to adjust their practices to separate and highlight key contractual clauses. This could include writing the clause in large, concise, bold text, with a direct explanation of the clauses’ impact on personal rights. Additionally, companies could require a separate checkbox for agreement, or send follow-up notices via email or within online accounts. | | | | |
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And then what? Your draft doesn't actually address the question raised. If the buyer is not bound by the terms presented by the seller, to what terms is the buyer bound? If the seller has no way of protecting any of its expectations, why should it engage in transactions at all? | >
> | Advantages of this Approach
This proposal does not suggest that consumers are only bound to what they actually read. This is not the triumph of the illiterate. Rather, this proposal attempts to align the legal system to reflect real-world contracting behavior and mirror heightened notice requirements in other areas of law where individuals are uniquely disadvantaged. This proposal has no impact on contractual clauses that do not affect the legal rights of individuals. If consumers still choose to assent to a mandatory arbitration clause, or any other Rights-Affecting Clause, then it is just as binding. The substantive change here is that the burden will now fall on the company, the party with outsized bargaining power, to exercise real effort into conveying adequate notice in contexts where consumer’s rights are at stake. | | | | |
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< | So let's make the draft better by actually answering the question. Instead of the terms presented by the seller that we no longer presume they buyer has read and accepted, the law imposes other terms. What are they? How are they determined, and by what non-fictional means do we ensure that buyers actually know those terms? Or have we stopped caring whether buyers understand the terms that apply to their purchases? If actual knowledge is not the goal, what was wrong with the original state of affairs in the first place? If, on the other hand, we can achieve actual knowledge of the new terms, what would have prevented the seller from rephrasing the original terms in such a way as to convey actual knowledge? | >
> | This approach better reflects interests in fundamental fairness and the prioritization of personal rights above economic interests in efficiency. If someone is going to oust themself from court, they should know they are doing so. | | | | |
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< | Is the buyer free of all responsibility to understand? Is the actual and intentional ignorance of the buyer an option to nullify all terms? Does this apply to everything, or just to terms of services on the Web?
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You are entitled to restrict access to your paper if you want to. But we all derive immense benefit from reading one another's work, and I hope you won't feel the need unless the subject matter is personal and its disclosure would be harmful or undesirable. |
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MikeSteinthalFirstEssay 3 - 20 Apr 2025 - Main.EbenMoglen
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< | It is strongly recommended that you include your outline in the body of your essay by using the outline as section titles. The headings below are there to remind you how section and subsection titles are formatted. | | | The Unconscionability of Unconscionability | | | Instead, this legal fiction should be eliminated in its entirety. | |
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And then what? Your draft doesn't actually address the question raised. If the buyer is not bound by the terms presented by the seller, to what terms is the buyer bound? If the seller has no way of protecting any of its expectations, why should it engage in transactions at all?
So let's make the draft better by actually answering the question. Instead of the terms presented by the seller that we no longer presume they buyer has read and accepted, the law imposes other terms. What are they? How are they determined, and by what non-fictional means do we ensure that buyers actually know those terms? Or have we stopped caring whether buyers understand the terms that apply to their purchases? If actual knowledge is not the goal, what was wrong with the original state of affairs in the first place? If, on the other hand, we can achieve actual knowledge of the new terms, what would have prevented the seller from rephrasing the original terms in such a way as to convey actual knowledge?
Is the buyer free of all responsibility to understand? Is the actual and intentional ignorance of the buyer an option to nullify all terms? Does this apply to everything, or just to terms of services on the Web?
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You are entitled to restrict access to your paper if you want to. But we all derive immense benefit from reading one another's work, and I hope you won't feel the need unless the subject matter is personal and its disclosure would be harmful or undesirable.
To restrict access to your paper simply delete the "#" character on the next two lines: |
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MikeSteinthalFirstEssay 2 - 19 Feb 2025 - Main.MikeSteinthal
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< | | | | It is strongly recommended that you include your outline in the body of your essay by using the outline as section titles. The headings below are there to remind you how section and subsection titles are formatted. | | | It is strongly recommended that you include your outline in the body of your essay by using the outline as section titles. The headings below are there to remind you how section and subsection titles are formatted. | |
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< | Paper Title | >
> | The Unconscionability of Unconscionability | | | -- By MikeSteinthal - 17 Feb 2025 | |
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< | Section I | >
> | Here is an Idea
In introductory contract law courses, students are taught that consumers are bound by the terms and conditions they agree to when they sign up for any service. This presumption is removed from reality and ultimately harmful to individuals, to the benefit of corporations. The world would be better off if we applied legal realism to this context, stopped pretending that individuals read their contracts, and stopped holding people accountable to these terms. | | | | |
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< | Subsection A | >
> | Here is how I came by it
In my first semester of law school contracts course, we read a series of cases in the syllabus unit “Unconscionability.” This segment of the course was designed to provide students with an introduction to the contours of consumer adhesion contracts. In daily life, individuals are constantly purchasing goods and signing up for services. This is particularly true in the internet context, where most websites require people to create accounts in order to use them. When registering for any of these services, one undoubtedly is prompted to agree to the "terms and conditions" of that website, often clicking a small box to affirm that the new user has read through, understands, and consents to be bound to those terms and conditions. | | | | |
>
> | Of course, nobody actually reads those terms and conditions. But for legal purposes, we are taught, that doesn't matter. The law here creates a "legal fiction," a departure from reality solely for legal purposes. Professor Gillis, who taught my first semester contracts class, described the fiction aptly. I will paraphrase her wonderful explanation of the legal fiction here: "The law imagines the user who just purchased their new software, or who just started registering for an online account, pausing at the step in the process where they are confronted with the terms and conditions, and must decide whether to click on the "I accept" box. Before clicking, the user prints out every last page of terms, binds them together to create a manuscript, saunters over to her armchair by her fireplace, kicks her feet up on her ottoman, lets out a sigh, and begins leafing through. She reads each page, annotating the margins, taking note of all the duties, obligations, and responsibilities contained therein. Finally, she thinks to herself, "_Am I amenable to these terms_?"; Only if that answer is a resounding “_Yes_!”, then she continues on with her account or software registration, confident in her legal situation and positioning.” | | | | |
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< | Subsub 1 | >
> | If that story sounds comical, it is. But it captures the state of contract law, and its presumption that users read, digest, comprehend, and affirmatively consent to be bound by the terms and conditions of every product and service they consume. | | | | |
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< | Subsection B | >
> | Here is what causes me to have confidence in this idea
In an ideal contract, the two parties to the contract, or more likely, their lawyers, fight tooth and nail over every clause. Each word is litigated, haggled, and argued over until a mutually acceptable version is produced. This bargaining negotiation ensures that the final contract serves the interests of both parties. Otherwise, as rational economic actors, they would not agree to it. | | | | |
>
> | The legal fiction in consumer contracts departs immensely from this negotiation-oriented conception of contract law. However, it binds the user to the ultimate contract just the same. There are many reasons why this is inappropriate. | | | | |
<
< | Subsub 1 | >
> | Unlike in the bargained-for context, consumers ordinarily do not understand their position in the matter. Without legal training, they simply lack the ability to understand the terms of the contract itself, and do not understand their own position in these legal matters to a sufficient extent such that they could meaningfully argue on their own behalf. Consider a mandatory arbitration clause. If a consumer doesn’t understand what arbitration is and how agreeing to it restricts their opportunities, how could they possibly negotiate with a company’s legal team about it? | | | | |
>
> | Furthermore, even if a consumer had the wherewithal to understand the substance of a contract, and wanted to effectuate change to the contract’s clauses, there is an enormous power imbalance at play. Most consumers do not have the time, money, or resources of a corporation available to mobilize towards demanding better terms. | | | | |
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< | Subsub 2 | >
> | Finally, if a consumer wants, or needs, to use this particular company’s product or service, they lack alternatives. In the bargained-for contract scenario, both parties negotiate with the understanding that if the scales tip too far in either direction, the other party can freely leave and find a better option elsewhere. That is not so in the consumer context. Consumers who want to use a particular product effectively must accept the company’s terms and conditions. Often, competitors will offer the same boilerplate terms and conditions, leaving the consumer with no meaningful alternative. | | | | |
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> | There are myriad issues with this legal fiction. | | | | |
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> | Here is where it might lead you | | | | |
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< | Section II | >
> | It is taught in introductory Contracts courses that the doctrine of unconscionability creates a protection for consumers from these adhesion contracts. Unconscionability refers to the discretionary ability for judges to evaluate whether a contract provision is so imbalanced, so detrimental to a consumer, that it must be deleted from the contract entirely. | | | | |
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< | Subsection A | >
> | Unconscionability is not an appropriate solution. It does not resolve any of the issues mentioned. All it does is create a high water mark, beyond which companies can not go. It says nothing about the vast realm of contractual clauses binding on consumers that fall short of stirring a judges’ conscience. It is unfair for consumers to be bound to the terms of enormous legal documents that they almost certainly will not read, so long as those terms do not erode substantive and procedural rights so drastically that they sufficiently tug the heartstrings of the justice system. | | | | |
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< | Subsection B | >
> | Instead, this legal fiction should be eliminated in its entirety. | | |
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MikeSteinthalFirstEssay 1 - 17 Feb 2025 - Main.MikeSteinthal
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It is strongly recommended that you include your outline in the body of your essay by using the outline as section titles. The headings below are there to remind you how section and subsection titles are formatted.
Paper Title
-- By MikeSteinthal - 17 Feb 2025
Section I
Subsection A
Subsub 1
Subsection B
Subsub 1
Subsub 2
Section II
Subsection A
Subsection B
You are entitled to restrict access to your paper if you want to. But we all derive immense benefit from reading one another's work, and I hope you won't feel the need unless the subject matter is personal and its disclosure would be harmful or undesirable.
To restrict access to your paper simply delete the "#" character on the next two lines:
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