B. UNCONSCIONABILITY

Although couched in different terms, many courts have struck down otherwise valid arbitration clauses when the health care provider or other party seeking arbitration has taken unfair advantage of the weaker party:

A court will generally refuse to enforce a contract on the ground of unconscionability only when the inequality of the bargain is so manifest as shock the judgment of a person of common sense, and where the terms are so oppressive that no reasonable person would make them on the one hand, and no honest and fair person would accept them on the other. Hume v. United States, 132 U.S. 406, 10 S.Ct. 134, 33 L.Ed. 393 (1889). . . . In determining whether a contract is unconscionable, a court must consider all the facts and circumstances of a particular case. If the provisions are then viewed as so one-sided that the contracting party is denied any opportunity for a meaningful choice, the contract should be found unconscionable.

Brenner v. Little Red School House, Ltd., 302 NC 207, 213, 274 S.E.2d 206, 210 (1981) (contract in question was not unconscionable because parties were of equal bargaining power and plaintiff was not forced to accept its terms).

1. CONTRACTS OF ADHESION

In Broemmer v. Abortion Services of Phoenix, a clause requiring the patient to arbitrate any potential claim with a AAA panel of obstetricians/gynecologists and was presented as a condition of treatment was found unconscionable:

An adhesion contract is typically a standardized form ‘offered to consumers of goods and services on essentially a ‘take it or leave it’ basis without affording the consumer a realistic opportunity to bargain and under such conditions that the consumer cannot obtain the desired product or services except by acquiescing in the form contract.

Broemmer v. Abortion Services of Phoenix, Ltd., 173 A.2d 148, 151, 840 P.2d 1013, 1016 (1992). The Broemmer Court then went on to consider whether the contract of adhesion was nonetheless enforceable, by looking at the reasonable expectations of the patient and whether the contract was unconscionable:

Generally speaking, there are two judicially imposed limitations on the enforcement of adhesion contracts or provisions thereof. The first is that such a contract or provision which does not fall within the reasonable expectations of the weaker or ‘adhering’ party will not be enforced against him. . . . The second – a principle of equity applicable to all contracts generally – is that a contract or provision, even if consistent with the reasonable expectations of the parties, will be denied enforcement if, considered in its context, it is unduly oppressive or ‘unconscionable.’

Broemmer, 173 A.2d at 151, 840 P.2d at 1016 (quoting Graham v. Scissor-Tail, Inc., 171 Cal Rptr. 604, .612, 623 P.2d 165, 172-173).