In business litigation, Florida courts will not enforce an agreement if the agreement is unconscionable. Under Florida law, “before a court may hold a contract unconscionable, it must find that it is both procedurally and substantively unconscionable.” Gainesville Health Care Ctr., Inc. v. Weston, 857 So. 2d 278 (Fla. 1st DCA 2003). It is therefore important for businesses to understand that its negotiation process and substantive contract terms may be scrutinized by Florida courts in breach of contract actions if a defense of unconscionability is raised. Peter Mavrick is a Fort Lauderdale business litigation attorney, and represents clients in business litigation in Miami, Boca Raton, and Palm Beach. The Mavrick Law Firm represents businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.
“The concept of unconscionability does not mean, however, that a court will relieve a party of his obligations under a contract because he has made a bad bargain containing contractual terms which are unreasonable or impose an onerous hardship on him.” Gainesville Health Care Ctr., Inc. v. Weston, 857 So. 2d 278 (Fla. 1st DCA 2003). “It is only where it turns out that one side or the other is to be penalized by the enforcement of the terms of a contract so unconscionable that no decent, fair-minded person would view the ensuing result without being possessed of a profound sense of injustice, that equity will deny the use of its good offices in the enforcement of such unconscionability.’” Steinhardt v. Rudolph, 422 So. 2d 884 (Fla. 3d DCA 1982).
Under Florida law, courts will only find a contract to be unconscionable if it is both procedurally and substantively unconscionable. Bellsouth Mobility LLC v. Christopher, 819 So. 2d 171 (Fla. 4th DCA 2002). However, while both elements must be present, they do not have to be present to the same degree. Basulto v. Hialeah Auto., 141 So. 3d 1145 (Fla. 2014). In Basulto, Florida’s Supreme Court held that court should use a “sliding scale” approach when both procedural and substantive unconscionability are present to some degree. This sliding scale analysis employs “a balancing approach . . . allowing one prong to outweigh another provided that there is at least a modicum of the weaker prong.” SHEDDF2-FL3, LLC v. Penthouse S., LLC, 314 So. 3d 403 (Fla. 3d DCA 2020). “The more substantively oppressive the contract term, the less evidence of procedural unconscionability is required to conclude that the term is unenforceable, and vice versa.” 12550 Biscayne Condo. Ass’n, Inc. v. NRD Investments, LLC., 46 Fla. L. Weekly D2401 (Fla. 3d DCA Nov. 10, 2021).