Ark. Code Ann. § 4-2-302 (2026)
Unconscionable contract or clause
- If the court as a matter of law finds the contract or any clause of the contract to have been unconscionable at the time it was made the court may refuse to enforce the contract, or it may enforce the remainder of the contract without the unconscionable clause, or it may so limit the application of any unconscionable clause as to avoid any unconscionable result.
- When it is claimed or appears to the court that the contract or any clause thereof may be unconscionable the parties shall be afforded a reasonable opportunity to present evidence as to its commercial setting, purpose and effect to aid the court in making the determination.
History. Acts 1961, No. 185, § 2-302; A.S.A. 1947, § 85-2-302.
Research References
Ark. L. Notes.
Copeland, The Implied Warranty of Habitability and the Use of the Uniform Commercial Code by Analogy, 1983 Ark. L. Notes 5.
Prettyman, The Landlord Protection Act, Arkansas Code § 18-17-101 et seq., 2008 Ark. L. Notes 71.
Ark. L. Rev.
Unconscionable Contracts and the Uniform Commercial Code, 20 Ark. L. Rev. 165.
Unconscionable Contracts: A New Approach for the Arkansas Lawyer, 21 Ark. L. Rev. 427.
U. Ark. Little Rock L.J.
Pasvogel, Mortgage Substitutes — The Law in Arkansas, 9 U. Ark. Little Rock L.J. 433.
Case Notes
Contract Not Unconscionable.
Assuming that the provisions of the Uniform Consumer Code applied to the lease of a skid-steer loader used for landscaping, an exculpatory clause contained in the lease agreement stating that the leasing company was not responsible for injuries sustained in the use of the loader was not unconscionable. Jordan v. Diamond Equip. & Supply Co., 362 Ark. 142, 207 S.W.3d 525 (2005).
Contract Unconscionable.
A finding of unconscionability was not clearly erroneous where: the agreement was a preprinted form; the provision relating to loss of future revenues was harsh in its operation; the contract was signed at a time when the defendant was already in default under its terms; and there appeared to be a substantial disparity in the relative bargaining power of the parties. Associated Press v. Southern Ark. Radio Co., 34 Ark. App. 211, 809 S.W.2d 695 (1991).
Evidence.
The issue of unconscionability is one requiring factual development and determination. Young v. American Cyanamid Co., 786 F. Supp. 781 (E.D. Ark. 1991).
Futures Contracts.
Contracts for sale of cotton to be raised in the future were not unconscionable because the price for cotton was much higher when the time came to sell the crop, since the contracts were to be reviewed as of the time made and at that time there was no way of knowing that prices would go up. J.L. McEntire & Sons v. Hart Cotton Co., 256 Ark. 937, 511 S.W.2d 179 (1974).
Misrepresentations.
A contract providing for the sale of timber would not be enforced where the first party misrepresented his experience and knowledge as a timber buyer to the second party, and where the party who was going to cut and remove the timber misrepresented the value of the timber to the other party. Davis v. Kolb, 263 Ark. 158, 563 S.W.2d 438 (1978).
Cited: In re Pettit, 18 B.R. 8 (Bankr. E.D. Ark. 1981); Structured Invs. Co., LLC v. Price (In re Price), 313 B.R. 805 (Bankr. E.D. Ark. 2004); Welsh v. Mid-South Bulk Servs., 2011 Ark. App. 728 (2011).