364. EFFECT OF UNFAIRNESS
(1) Specific performance or an injunction will be refused if
such relief would be unfair because
(a) the contract was induced by mistake or by unfair
(c) the exchange is grossly inadequate or the terms of the
contract are otherwise unfair.
a. Types of unfairness.
Courts have traditionally refused equitable relief on grounds of unfairness or mistake in situations where they would not
necessarily refuse to award damages. Some of these situations involve elements of mistake,
misrepresentation, duress, or undue influence that fall short of what is required for avoidance under those
doctrines....Still others involve elements of substantive unfairness in the exchange itself or in its terms
that fall short of what is required for unenforceability on grounds of unconscionability.
1. A is an aged, illiterate farmer, inexperienced in business. B
is an experienced speculator in real estate who knows that a developer wants to acquire a
tract of land owned by A and will probably pay a price considerably above the previous market
price. B takes advantage of A's ignorance of this fact and of his general inexperience and
persuades A not to seek advice. He induces A to contract to sell the land at the previous market price,
which is considerably less than the developer later agrees to pay B. A refuses to perform, and B
sues A for specific performance. Specific performance may properly be refused on the ground of
5. A, an individual, contracts in June to sell at a fixed price
per ton to B, a large soup manufacturer, carrots to be grown on A's farm. The contract,
written on B's standard printed form, is obviously drawn to protect B's interests and not A's; it
contains numerous provisions to protect B against various contingencies and none giving analogous
protection to A. Each of the clauses can be read restrictively so that it is not unconscionable, but
several can be read literally to give unrestricted discretion to B. In January, when the market price
has risen above the contract price, A repudiates the contract, and B seeks specific performance. In
the absence of justification by evidence of commercial setting, purpose or effect, the court may
determine that the contract as a whole was unconscionable when made and may properly deny specific
performance on the ground of unfairness regardless of whether it would award B damages for breach.