Arnold v. United Companies Lending Corp

In Arnold v. United Companies Lending Corp., 204 W.Va. 229, 511 S.E.2d 854 (1998), the Court emphasized how critical the facts of each case are in determining whether a particular transaction or agreement is unconscionable. After acknowledging that the West Virginia Consumer Credit and Protection Act fails to define the term "unconscionable," the Court referenced the previous reliance on the definition provided in the Uniform Consumer Credit Code based on the identical language of the provisions. Arnold, id. at 235, 511 S.E.2d at 860. The drafters of the Uniform Consumer Credit Code explained that the principle of unconscionability "is one of the prevention of oppression and unfair surprise and not the disturbance of reasonable allocation of risks or reasonable advantage because of superior bargaining power or position." See Uniform Consumer Credit Code, 5.108 comment 3, 7A U.L.A. 170 (1974). The drafters stated: "The basic test is whether, in the light of the background and setting of the market, the needs of the particular trade or case, and the condition of the particular parties to the conduct or contract, the conduct involved is, or the contract or clauses involved are so one sided as to be unconscionable under the circumstances existing at the time the conduct occurs or is threatened or at the time of the making of the contract." Id. The drafters explained further that "the particular facts involved in each case are of utmost importance since certain conduct, contracts or contractual provisions may be unconscionable in some situations but not in others." Id. (204 W.Va. at 235, 511 S.E.2d at 860.)