Rough Draft

1

To: Susan K. Patrick, Esq. From: Froydan Deleon Torres RE: Andrew and Allison Jones, Unconscionability defense – Firm File number 4182016 Date: 18th February, 2024

Introduction The contract between Andrew and Allison Jones should be considered unconscionable because the agreement depicts gross disparity and overreaching or oppressive influences. According to Virginia courts, such agreements are unenforceable if deemed unconscionable. Virginia courts apply the two-part prong test to determine if agreements and contracts are unconscionable. Based on the two-prong test, an agreement is considered unconscionable if it depicts significant gross disparity, which explains the disproportionate asset division. The agreement is also considered unconscionable if evidence of overreaching or oppressive influences forces one of the parties to sign the agreement. When overreaching or oppressive influences are depicted, the agreement is unenforceable because one party seeks to benefit from the settlement of the assets by coercing the other party into signing an agreement. The Jones have received legal information cautioning them about the legal actions that would be taken if they failed to pay the balance cost for the washer and dryer. The legal actions also include an additional $1000 for failing to pay the costs promptly. According to the Joneses, the agreement should be nullified, citing that there was unconscionability in the contract, making it void. However, based on the two-prong test in Virginia courts, an agreement or contract is deemed unconscionable if it meets the two parts of the test. The situation should also be convincing, calling for the courts to determine the unconscionability of the contract based on a single part of the two-prong test. There is no current action on the Andrew and Allison Jones case; however, the possible action would be claiming there was no breach in the contract because the agreement was unconscionable.

The Presented Question Is the contract for the laundry set, which is twice the retail price, unconscionable?

Statement of Facts The Joneses purchased a washer and dry set from Advantage Housewares in Greenacre. Mr. and Mrs Jones found that the washer and the dryer were broken when they got the laundry set to their home. The couple live in the rural parts of the region, making it challenging to obtain alternative means for washing and cleaning their laundry. The couple also needed financial resources to purchase a new cleaning and washing laundry set. Based on their financial position and the rural setting of the location they live in, the couple decided to get a new laundry set from an appliance store that would allow them to make monthly payments because they did not have the financial capability to get the set by paying an upfront cost of the machine. Mr. and Mrs. Jones had adequate knowledge that the mode of purchase would attract paying more than the retail price of the machine set. Unfortunately for the Joneses, they got denied in most of the stores they tried, making them try Advantage Houseware, where they had obtained their previous washer and dryer set.

2

At Advantage Houseware, the salesperson informed Mr. and Mrs. Jones that the final cost of the washer and dryer set would be more expensive than the retail price in the long run, but there was a competitive price, too. Mr. and Mrs. Jones entered Mr. Plyburn's office to make the contract. They made a contract that included Mr and Mrs Jones making 12 monthly payments, each attracting $250 monthly. The couple agreed with the contract because they had no alternative options and choices, even though they understood the price was high. After making three monthly payments promptly, Mr and Mrs Jones missed their fourth payment, which was caused by the death of Mr Jones's father. The death of Mr Jones's father caused the couple an increased financial burden, making their financial position worse than it was before. Having realized they missed a monthly payment, Mrs. Jones submitted payments of $500 to cover two monthly payments: one for the missed payment and the other for the next month's payments. However, Advantage Housewares submitted a letter to Mr. and Mrs Jones two weeks after receiving the $500 payments from Mrs Jones. The letter informed Mr and Mrs Jones that they were liable for the total cost of the washer and dryer set because they missed a payment. The letter also asked Mr. and Mrs. Jones to make an additional $1000. Advantage Housewares cited that the payment was due immediately. On receiving the letter, Mrs. Jones confirmed the competitive pricing of the washer and dryer set, realizing that the cost was charged more than the retail price of the laundry set. One week after they received the letter, Mr. and Mrs. Jones received a second letter from Advantage Housewares. The letter stated that Advantage Housewares had filed an action against Mr. and Mrs. Jones, citing that the couple had to pay the amount immediately or the laundry set would be repossessed.

Discussion Gross Disparity A gross disparity occurs when there is a disproportionate difference in the price or value of the shared assets or property among the parties involved. In terms of marital assets, a spouse can surrender their marital assets or property to the other if there are no indications of tyrannical behavior in the parties. Individuals can dispose of their marital assets freely according to their will. For instance, according to the Galloway case, the spouse agreed that Mr. Galloways would retain their marital home and family business. At the same time, Mrs. Galloway would receive her personal belongings and the family track pickup. Since Mrs. Galloway had recently received an inheritance from her father, including $30,000 in cash and a home valued at $275,000, the parties agreed to waive their privileges and discuss the agreement's details before it was created Galloway v. Galloway, 622 S.E.2d 267 (Va. Ct. App.2005). Mrs Galloways was also advised to seek legal guidance before signing the contract. While the case depicts considerable inequality in the shared assets, the court ruled that the agreement between Mr. and Mrs. Galloway did not involve gross disparity since Mrs Galloway had received an inheritance from her father that portrayed significant economic relevance as it would be before they divorced. Mr. and Mrs. Jones had a financial challenge that forced them to acquire the second laundry set through a

3

payment plan, calling for determining the presence of a gross disparity. Sims v. Sims, 55 Va. App. 340 (2009).

Mr. and Mrs. Jones can indicate gross disparity by illustrating that they did not know the retail price. Through this approach, the couple can explain that their original price will double the actual market price of the laundry machine set. The couple needed to be more knowledgeable than Adnatage Houseware's salesperson regarding understanding retail prices for the laundry machine set. This gives a gross disparity between the couple and the salesperson, giving the salesperson an advantage over Mr. and Mrs. Jones. Mr. Plyburm was a significant sales personnel in the company and had extensive knowledge regarding the laundry machine's market price and the contract's details. The differences in the market cost of the appliance and the double price that they are required to pay to Advantage Housewares can warrant the court a favor based on gross disparity for the couple. Overreaching or Oppressive Influences Overreaching and oppressive influence occurs when one party applies coercive practices to pressure the other party into signing an agreement that will lead to the advantage for the oppressing party in case of a settlement. A contract or agreement is not enforceable if one of the parties coerced the other party into signing the contract. For instance, in the case of Mr. and Mrs. Derby, Mr. Derby had a great desire to make things work for his family. Mr. Derby was determined to reconcile with Mrs. Derby and the entire family. According to Mr. Derby, Mrs. Derby made it clear there was an opportunity for them to make a communal agreement to save and rescue their marriage. Derby. Derby v. Derby, 378 S.E.2d 74 (Va. Ct. App. 1989). Mrs. Derby used the emotional attachment that Mr. Derby had for her to coerce Mr. Derby into signing the agreement. Mrs. Derby defrauded the husband through unfaithful acts, such as summoning Mr. Derby outside of counsel. Mr. Derby signed the agreement based on his emotional attachment to his wife. The court found reasonable oppressive influence by Mrs. Derby, making Mr. Derby sign the agreement documents in the hope they would mend their relationship. The salesperson took the emotional challenges that Mr. and Mrs. Jones had due to a financial challenge to his advantage, making it easier for them to sign the contract.

In the case of Mr. and Mrs. Jones, numerous occasions illustrate oppressive influence. The agreement is based on several overreaching or oppressive influences, including illustrations of bad faith by the salesperson, misrepresentation of the value price of the laundry machine set, and significant ignorance regarding the prices indicated by Mr. and Mrs. Jones. This can be demonstrated through Mr. and Mrs. Chaplain's case, in which Mrs. Chaplain had little understanding of English in writing and reading. Chaplain v. Chaplain, 682 S.E. 2d 108 (Va. Ct. App. 2009). This gave Mr. Chaplain an advantage over his wife, Mrs. Chaplain, who had an Arab language. This needed to give Mrs. Chaplain adequate disclosure of the agreement's information. In the case of Mr. and Mrs. Jones, they were aware they were signing an agreement for $250

4

monthly payments over 12 months. The extra $1000 was not mentioned in the contract; if it was, they were unaware of it. Failure to provide adequate disclosure regarding the particulars of the contract is considered an oppressive influence.

Conclusion The contract for the laundry machine set that was twice the retail price should be considered unconscionable and, therefore, not enforceable. Virginia courts apply the two-prong test to determine the unconscionability of an agreement. The first prong determines the unconscionability of an agreement based on gross disparity. According to gross disparity, the courts determine if the agreement or contract gave one party the benefits through an unjustified and extreme proportion of the asset compared to the second party. The second prong in the test determines the presence of overreaching or oppressive influences by one party over the other, forcing the oppressed party to sign the agreement for the advantage of the party doing the coercing practice. Coercing mounts pressure on one party and may include threats and other forms that may lead or force one party to surrender part of their assets or property. These two prongs are required to determine the unconscionability of the agreement. However, in some extreme cases, the courts can consider a single prong in determining the unconscionability of the contract or agreement. Enforcing the contract against Mr. and Mrs. Jones should be considered unconscionable because the case depicts gross disparity and overreachon or oppressive influences.