Unconscionability & Leases
Our legislators have a new favorite word.
by Josh Bibeau on April 17th, 2021
House Bill 402 was signed into law on Friday, April 16th. It will affect how leasing & enforcement of leases happen in Montana. As I read the bill I couldn't help but notice the use of unconscionability, as it appears at least fifteen times in the bill.
Here is a copy of the bill: https://leg.mt.gov/bills/2021/billpdf/HB0402.pdf
Cornell Law’s Legal Information Institute describes it like this: “If a contract is unfair or oppressive to one party in a way that suggests abuses during its formation, a court may find it unconscionable and refuse to enforce it. A contract is most likely to be found unconscionable if both unfair bargaining and unfair substantive terms are shown. An absence of meaningful choice by the disadvantaged party is often used to prove unfair bargaining.”₁ Most of the bill seems common sense to me: put something unreasonable in your lease, don’t expect the courts to honor it. Does this mean that tenants should just sign any term in any lease and expect the courts to side with the tenant? Tenants should still use caution when signing a legal document, but I’m sure courts will find plenty of unconscionable terms in Montana leases. If you have a lease, might be time to look over those terms and filter it through a reasonability index. None of us have any justification for presenting unreasonable terms in our leases, even with the extremely competitive market we are all benefiting from now.
Is the legislature asking us to grow a conscience? I believe so.
Thoughts?: josh@bigfootmg.com
