TO: Susan K. Patrick, Esq.
FROM: Candace Hollingsworth
DATE: April 4, 2024
RE: Brief Rough Draft
INTRODUCTION
An action has been brought by Andrew and Allison Jones against Advantage Housewares
which alleges the contract entered into for the purchase of a washer and dryer asset was
unconscionable. Advantage Housewares have threatened Mr. and Mrs. Jones they would
repossess the appliances and take legal action if the remaining cost of the appliances plus an
additional $1000 is not paid immediately. The total amount demanded by Advantage
Housewares totals $2750. Mr. and Mrs. Jones claim the contract they entered into is
unconscionable and should be found void. To test for unconscionability of a contract in Virginia,
a two-prong test is applied, for both gross disparity and overreaching or oppressive influences.
The court examines the facts of a case to first determine if there is gross disparity in reference to
the value exchanged between the parties. If one party is left with a considerably less value, the
court may find gross disparity exists. Second, the court examines the evidence to see if
overreaching behavior or oppressive influences existed during the time the contract was entered
into. There is currently no current action by Mr. and Mrs. Jones against Advantage Housewares,
however a possible claim would be that Mr. and Mrs. Jones did not break the contract because if
a contract is unconscionable, it is void.
STATEMENT OF FACTS
Upon Mr. and Mrs. Jones discovering their washer and dryer were inoperable, they were
in a position where they needed to purchase a new set. Mr. and Mrs. Jones live in a rural area and
doing their laundry at a laundry facility was not an option for them. Additionally, they did not
have the financial resources needed to pay for a new washer and dryer in full. In need of
someone that would allow them to make payments on a set, they attempted to get qualified for
financing at several retail locations before visiting Advantage Housewares. Upon meeting with a
salesman, they picked out a set and was verbally told although their total payments would be
slightly higher than other retailers, their final cost would be competitive. The payment schedule
was set up to be $250 per month for 12 months, with a final cost of $3000. Although Mr. and
Mrs. Jones felt the price was high, they agreed to the payment terms, as they needed the washer
and dryer. Once the agreement was signed, the washer and dryer set was delivered to their home
the same day.
Mr. and Mrs. Jones made their expected payment for 3 consecutive months as agreed.
Prior to the fourth payment being due, Mrs. Jones’ mother passed away and Mr. Jones’ father
became very ill. The fourth payment in their plan was not paid due to the couple being busy
planning Mrs. Jones’ funeral and caring for Mr. Jones’ father. Mrs. Jones states as soon as she
realized the fourth payment was missed, she included the missed payment amount in with her
fifth payment, which was paid on time as scheduled, for a total amount paid of $500. Two weeks
after Mrs. Jones made the $500 payment, Mr. and Mrs. Jones received a letter from Advantage
Housewares demanding balance in full due to the missed payment. The total due was $2750,
which was the remaining balance plus an additional $1000 late fee. If Mr. and Mrs. Jones were to
pay the total amount due as demanded by Advantage Housewares, they would have paid a total
of $4000 for the washer and dryer set. Mr. Jones researched the price of the same set at various
retailers and discovered the same set is being sold elsewhere at a price of $1000 to $1250. Paying
the total due per Advantage Housewares would be equal to purchasing three sets from a different
retailer. One week after receiving the letter demanding payment in full, Mr. and Mrs. Jones
received another letter from Advantage Housewares stating a legal action was filed against them
to have the contract enforced or the washer and dryer set repossessed.
QUESTION PRESENTED
What two-pronged test is applied by Virginia Courts to determine whether a contract is
unconscionable?
BRIEF ANSWER
“For an agreement to be deemed invalid, the person contesting its validity must prove so
by clear and convincing evidence. , 378 S.E.2d 19, 26 (Va. Ct. App. 1989). ” Derby v. Derby
Anyone challenging an agreement on the ground that it is unconscionable must prove both 1) a
gross disparity existed in the division of assets and 2) overreaching or oppressive influences.
Virginia Courts apply a two-prong test when determining whether a contract or agreement is
unconscionable. First, the court determines if gross disparity exists by comparing the total value
