unconscionability test in Alabama

2004In any event, while our decision in Branch considered the breadth of the arbitration provision as an indicium of unconscionability, this Court has subsequently noted that our consideration of that factor in Branch also took into account numerous other factors: "Walser points out that this Court in American General Finance, Inc. v. Branch , 793 So.2d 738 , 740 (Ala. 2000), concluded that the language `"all claims, disputes, or controversies of every kind and nature between Borrower(s) and Lender shall be resolved by binding arbitration, including . . . those arising out of or relating to the tr

2004However, in American General Finance, supra , this Court did not rely solely on the breadth of the arbitration clause; rather, it noted that there were several indicia that the provisions of the contract were `so grossly favorable . . . as to pass the first prong' of the unconscionability test. 793 So.2d at 750 .

1998Although the doctrine of unconscionability/mutuality of remedy purportedly could apply in the nonarbitration context, as suggested in the main opinion in Northcom, it directly depends on arbitration for its application: “The element of unconscionability in the context of an arbitration clause is supplied by the fact that, by agreeing to arbitrate, a party waives his right to ‘a remedy by due process of law1 ... and his ‘right of trial by jury’_” Northcom, 694 So.2d at 1338-39 (citations omitted).

1998Any alteration, amendment, modification, or revocation may be done only in writing, signed by the Senior Executive, Human Resources." In support of her argument that the language quoted above voids her agreement to arbitrate, under the doctrine of unconscionability/mutuality of remedy 5 , McNaughton *Page 597 relies heavily on Northcom, Ltd. v. James , 694 So.2d 1329 , 1338 (Ala. 1997), where two Justices on this Court stated in dictum: "[I]n a case involving a contract of adhesion, if it is not shown that the party in an inferior bargaining position had a meaningful choice of agreeing to arbi

1998See Goodwin, 970 F.Supp. at 1014 (“[Wjhile paying lip-service to the notion that [the doctrine of unconscionability/mutuality of remedy] ‘is equally true as to any unconscionable term of a contract of adhesion,’ ... the [lead opinion in Northcom ] relies on the uniqueness of the concept of arbitration under Alabama law to support the [doctrine].”).

1998See Goodwin , 970 F. Supp. at 1014 ("[W]hile paying lipservice to the notion that [the doctrine of unconscionability/mutuality of remedy] `is equally true as to any unconscionable term of a contract of adhesion,' . . . the [lead opinion in Northcom ] relies on the uniqueness of the concept of arbitration under Alabama law to support the [doctrine].").

2003We held that, under those circumstances, the arbitration provision was unconscionable because the terms were "unreasonably favorable [toward the defendant] and patently unfair [toward the plaintiffs,]" and therefore met the two-part unconscionability test set forth in American General Finance, Inc. v. Branch , 793 So.2d 738 , 748 (Ala. 2000). 14 854 So.2d at 538 ; see also Leonard , 854 So.2d at 539 ("This arbitration agreement is unconscionable because it is a contract of adhesion that restricts the Leonards to a forum where the expense of pursuing their claim far exceeds the amount in contro

2003We held that, under those circumstances, the arbitration provision was unconscionable because the terms were "unreasonably favorable [toward the defendant] and patently unfair [toward the plaintiffs,]" and therefore met the two-part unconscionability test set forth in American General Finance, Inc. v. Branch , 793 So.2d 738 , 748 (Ala. 2000). 14 854 So.2d at 538 ; see also Leonard , 854 So.2d at 539 ("This arbitration agreement is unconscionable because it is a contract of adhesion that restricts the Leonards to a forum where the expense of pursuing their claim far exceeds the amount in contro

2001McNaughton v. United Healthcare Servs., Inc., 528 U.S. 818 , 120 S.Ct. 59 , 145 L.Ed.2d 52 (1999), we disapproved that rationale; however, in Ex parte Parker, 730 So.2d 168, 171 (Ala.1999), we said: "The Parkers' argument has merit to the extent that the lack of mutuality of remedy can be one factor, along with others, that a court may consider in determining whether an arbitration clause is unconscionable." Thus, the absence of mutuality of remedy is still relevant in an unconscionability analysis.

1999See also Ex parte Napier 723 So.2d 49 (Ala.1998), and American General Finance, Inc. v. Manley, 729 So.2d 260 (Ala.1998).

1999See also Ex parte Napier 723 So.2d 49 (Ala. 1998), and American General Finance, Inc. v. Manley , 729 So.2d 260 (Ala. 1998).

1999See also Ex parte Napier 723 So.2d 49 (Ala.1998), and American General Finance, Inc. v. Manley, 729 So.2d 260 (Ala.1998).

1999See also Ex parte Napier 723 So.2d 49 (Ala. 1998), and American General Finance, Inc. v. Manley , 729 So.2d 260 (Ala. 1998).

1999See Ex parte McNaughton, 728 So.2d 592 (Ala.1998), rejecting the Northcom dictum regarding the doctrine of unconscionability/mutuality of remedy.

1999See Ex parte McNaughton , 728 So.2d 592 (Ala. 1998), rejecting the Northcom dictum regarding the doctrine of unconscionability/mutuality of remedy.