Crafting a Remedy for the Naughtiness of Procedural Unconscionability

Abstract

In this article I discuss the consequences of inducing someone to enter into an unconscionable contract and I suggest that there must be limitations on behavior associated with manipulative negotiation strategies. In addition, this article proposes that when inappropriate negotiation strategies result in an unconscionable term or agreement, there should be accountability if damages can be proven. Negotiation techniques and strategies are subject to scrutiny under the rubric of procedural unconscionability. Procedural unconscionability can be shown to have an impact on the sanctity of the contracting process. This article addresses the question of whether there is room in the law for a legal remedy for the consequences that may flow from procedural unconscionability. I propose a tort theory that I have named Consequential Procedural Unconscionability. The issues discussed are presented within the framework of a finding of unconscionability based on an unwarranted manipulation of cognitive biases or heuristics.

Keywords: Procedural Unconscionability, manipulative negotiation strategies, legal remedy, Behavioral Decision Theory

JEL Classification: D1, K12, K19