Waters v. Min Ltd Case Brief by Mythri

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									Waters v. Min Ltd. 412 Mass. 64, 587 N.E.2d 231 (Mass. 1992)
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Waters owned an annuity that was worth $189k in present value and $694k over its guaranteed term. She was on drugs and out of money. She was persuaded by her boyfriend to sell her annuity to Min for $50k. Waters didn't have a lawyer, but Min did. o The contract was also executed under unusual circumstances. For example, it was signed on the hood of a car. Also Min forgave part of a debt that the boyfriend owed to them for helping in this transaction. o The boyfriend suggested the deal after he had maxed out all her credit cards. The guy's a peach, ain't he? Waters sued to rescind the contract on the basis on unconscionablity. o The defendants counterclaimed for specific performance of the contract. The Trial Court found for Waters, gave her back the annuity plus $18k interest. Min appealed. o In the British case of Chesterfield v. Janssen, the term unconscionable was defined as a contract, "such that no man in his senses and not under delusion would make on one hand and as no honest or fair man would accept on the other." o The case of Campbell Soup Co. v. Wentz found a contract to be unconscionable when, "the sum total of its provisions drives too hard a bargain for a court of conscience to assist." The Appellate Court affirmed. o The Court found that Min was taking advantage of Waters' circumstances and should not be rewarded for their bad behavior.  Min assumed no risk and Waters received no advantage. o The Court proposed a six part test to determine unconscionablity:  The oppressiveness of the contract upon the

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disadvantaged party Unfair surprise to the disadvantaged party Allocation of risk to the disadvantaged party due to superior bargaining power on the part of the stronger party  Gross disparity in consideration  Evidence that the stronger party knowingly took advantage of the weaker party  The presence of high pressure sales tactics or misrepresentation UCC § 2-302 talks about unconscionablity with regards to the sale of goods. o Although this case wasn't a sale of goods and therefore not bound by the UCC, in this case, the Court used the UCC as part of their decision making process.
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