My Contract Reforms

Let's start with the basics - "adhesion contracts" are contracts that are presented on a "take it or leave it" basis. Generally these are the result of an imbalance of power between the contracting parties, like a big company and a single customer.

But adhesion contracts are becoming standard practice in all circumstances now. The problem is that they are filled with a lot of generic, often inapplicable clauses intended to allow one contract to serve for multiple products or services.

Because many adhesion contracts contain so much unrelated boilerplate, people don't have the patience to read through the generic, unrelated material to find the relevant parts. This has lead many industries to adopt fairly standard contracts with some truly frightening things. The most common is some version of "You waive all rights, we retain all rights." Most commonly, these are clauses that eliminate all guarantees, requires arbitration instead of litigation and allows the contract issuer to decide what arbiter to use, or a "You can't sue us but we can sue you" clause, or even a "You can't criticize us ever, no matter what" clause.

These clause sneak through because they're buried under piles of text that serve no clear purpose and appear to be shoved in there just because (and that is often the case). But they are occasionally enforced and, despite often being thrown out of court as unconscionable, stay in form contracts designed by (often subpar) promoters of "best-practice" contracts and industry standards.

There's also the secondary problem of "shrink-wrap licenses" - the terms of a contract revealed after the purchase is completed. (The phrase "shrink-wrap license" comes from the late 90's, when software EULAs were printed and kept inside shrink-wrapped boxes with the software storage medium. [and now I feel like a time-traveling historian.]) One of the most egregious examples of abusive shrink-wrap clauses is "This product is leased, not sold." It's a bald evasion of the First Sale Doctrine, despite the product being sold in the same manner as actual purchases, like books, or toys, or milk.

The core incentive for all of this is the vastly reduced costs in maintaining, disseminating and implementing contracts today. If you use a a prewritten contract, adding a twenty page contract to a fifteen dollar purchase requires essentially no cost, and the worst a court can do is refuse to enforce it.

So, I suggest the following restrictions that are limited exclusively to adhesion contracts:

1) Purchases made at retail outlets are purchases, not leases, unless the nature of the lease is made clear prior to purchase. (Generally on the packaging)

2) The introduction of contract clauses after the conclusion of the trade is prohibited.

3) The length and complexity of a contract must have some relation to the costs involved in the contract. Something cheaper than a floor lamp should not have a contract longer or more complex than the contract for a mortgage or a car purchase. (Actual details of limits to be specified later, should anything come of this. Perhaps some relation to word count and price.)

Note that these restriction are limited to adhesion contracts only, and are limited to address the abuses of contract law.

I am curious as to how this comes across, especially from people with a background in contract law.