What is an Adhesion Contract?
Whether or not we knew it by that name, many of us have signed at least one adhesion contract during our adult lives. A standard insurance policy is often considered to be an adhesion contract, as well as an apartment lease or a “End User’s Licensing Agreement” (EULA). Even the agreement with a local dry cleaner or other professional service could be consider an adhesion contract. Essentially, an adhesion contract is a take it or leave it arrangement between two parties, one considered much stronger than the other. The stronger party, for example an insurance company, generally provides a service or product that the weaker party wants or needs. Rather than negotiate each and every aspect of the agreement, the insurance company presents the customer with a standard contract filled with pages of legal language. The customer needs the insurance policy, so he may give the contract a quick glance or simply sign it in good faith. From that point on, the customer is legally bound to the terms
An Adhesion Contract is a standardized contract form offered to consumers for goods and services on essentially a “take it or leave it” basis. A typical example of an Adhesion Contract is an insurance policy. The Adhesion Contract rarely affords the consumer any realistic opportunity to bargain for special provisions under the contract. The conditions of the Adhesion Contract are generally such that the consumer cannot obtain a desired product or service unless the consumer acquiesces in the form of a contract which is presented. A distinctive feature of the Adhesion Contract is that the weaker party has no realistic choice as to its terms. The trend by the courts is to relieve parties from any unfair conditions imposed by the Adhesion Contract since the court recognizes that these Adhesion Contracts are not the result of a traditionally bargained position.
Related Questions
- One of my clients would like me to handle all of the contracts on their behalf. Do any scenarios exist in which a party may execute a Registry Contract on behalf of a Registry Operator?
- When I lease a commercial office space, is it absolutely necessary to hire an attorney to go over the contract?
- What is an Adhesion Contract?
