§ 5112 — Unconscionable agreement or term of contract

(a) Powers of contract.--The court, upon finding as a matter of law that a contract or contract clause was unconscionable at the time the contract was made, may:

(1) refuse to enforce the contract;

(2) enforce the remainder of the contract without the unconscionable clause; or

(3) limit the application of any unconscionable clause in order to avoid an unconscionable result.

(b) Parties may present evidence.--Whenever it is claimed or appears to the court that a contract or any contract clause is or may be unconscionable, the parties, in order to aid the court in making the determination, shall be afforded a reasonable opportunity to present evidence as to:

(1) the commercial setting of the negotiations;

(2) whether a party has knowingly taken advantage of the inability of the other party reasonably to protect his interests by reason of physical or mental infirmity, illiteracy or inability to understand the language of the agreement or similar factors;

(3) the effect and purpose of the contract or clause;

(4) if a sale, any gross disparity, at the time of contracting, between the amount charged for the real estate and the value of the real estate measured by the price at which similar real estate was readily obtainable in similar transactions, but a disparity between the contract price and the value of the real estate measured by the price at which similar real estate was readily obtainable in similar transaction does not of itself render the contract unconscionable.

Legislative History

Cross References.Section 5112 is referred to in section 5102 of this title.