The Instigator
Hotlegal
Pro (for)
Tied
0 Points
The Contender
randysanichara
Con (against)
Tied
0 Points

The ruling in Williams v. Walker-Thomas Furniture Co should be in favor of Williams.

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Voting Style: Open Point System: 7 Point
Started: 5/9/2014 Category: Miscellaneous
Updated: 2 years ago Status: Post Voting Period
Viewed: 485 times Debate No: 54360
Debate Rounds (4)
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Hotlegal

Pro

(1) Unconscionable is defined as going far beyond what is usual and proper
(2) The terms of the contract regarding the monthly installment payments are effectively obscure (511, 2, 1 and 2)
(3) The obscure payment terms resulted in each purchased item to carry a balance due on every item until the balance due on all items are paid in full or liquidated. (511, 2, 2)
(4) Further, each debt incurred at the time of purchase of each item was secured by the right to repossess all the items previously purchased. (511, 2, 3)
(5) Furthermore, each new item purchased automatically became subject to a security interest arising out of the previous dealings, as described in premise 4 above. (511, 2, 3)
(6) Premise 4 individually and both 4 and 5 collectively go far beyond what is usual and proper.
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(7) Thus the contract terms are unconscionable and should result in the ruling in favor of Williams.

The purchase and payment terms of the contract are beyond what is usual and proper, in that the terms are constructed so that every purchase on an installment contract is secured by all items purchased from the vendor by the purchaser. Should the purchaser default on an installment payment the vendor is allowed to repossess all items purchased as result of the terms of purchase and security. Therefore, the contract is unconscionable and the repossession of all items purchased should not be enforced.
randysanichara

Con

1. Appellate Williams bought a stereo set from the Walker-Thomas furniture company. (511.3.3)
2. Williams defaulted on her payments shortly after the purchase. (511.3.4)
3. The terms of the purchase were contained in a printed form contract. (511.1.2)
4. The terms of the contract were accepted by Williams at the time of the purchase.
5. The contracts clearly states that the Walker-Thomas furniture company can repossess an item(s) if the purchaser defaulted in the payment of any monthly installment. (511.1.3)
6. Williams did default, giving the furniture company the right to repossess the items.
7. It's William's, and not the furniture store's, responsibility to know what she can afford based on her living situation.
8. Unconscionability includes the absence of meaningful choice on the part of one of the parties. (512.4.1)
9. Meaningful choice is negated by a gross inequality of bargaining power. (512.4.2)
10. The furniture store did not have bargaining power because a stereo was not a necessity in this case
11. Therefore the contract was not unconscionable and the case should be decided in favor of the Walker-Thomas furniture company.

William's knew the term of the contract and she made the choice to enter into the contract. She also knew what she could and could not afford and she made the choice to purchase an item that she could not afford. She defaulted on her payment and the contract clearly states that if she defaulted on any payment the furniture store could repossess the item. Also, the contract was not unconscionable due to the fact that a stereo is not a necessity and thus the furniture store had no bargaining power.
Debate Round No. 1
Hotlegal

Pro

Based upon my premises 3, 4 and 5 and your premises 8, the terms of the contract were unconscionable in that every purchase resulted in that item to carry a balance due until the balance due on all items purchased, regardless of the timing of the purchase, are paid in full. Further, the term of the contract stated that each purchased item was secured by the previously purchased items. Based on these obscure terms alone the contract is unconscionable. The contract terms are not favorable to Williams and do not provide meaningful choice. If Williams makes a purchase today and pays it in full and soon thereafter purchases another item on installments based on the terms of the contract the new item purchased on installments will now be secured by the item previously purchased and paid for; and a default of an installment payment on the second purchased item would result in Williams losing both the item paid for and the item that was subject of the default. Once you pay for the item it is believed that you now own the item. However, according to the terms of the contract Williams will never own any of her items until she has a zero balance on her account despite having paid for items in full. This leaves Williams no meaningful choice. According to the facts over the course of 5 years Williams has paid to Walker Thomas Furniture Co. a total of $14,000.00; however the total of all the purchases made by Williams during this same time came to only $1,800.00. As such Williams overpaid the furniture company in the amount of $12,200.00 for the purchased items and still did not have ownership of any of the items previously purchased. We do not know how much any previously purchased item cost based on the facts; however, regarding Williams total purchase price in comparison to how much she actually paid over the course of 5 years is evidence of the unconscionability of the contract terms. Furthermore, Williams only showed a balance of $164 owed to the furniture store. If Williams total cost for items purchased was $1,800.00 the balanced owed of $164 would indicate that some, if not most, items purchased were paid for in full, but because of the obscure terms Williams still would not receive the title until she reached a zero balance. All of this is favorable to the Walker-Thomas Furniture Co. and there is no meaningful choice for Williams her only recourse is to reach a zero balance in order to have enjoyment of the purchased items as the owner. Therefore the contract terms are unconscionable and the ruling should be in favor of Williams.
randysanichara

Con

While it may be arguable that the contract slightly favors the Walker-Thomas furniture store, this alone is not enough to call the terms unconscionable due to the fact that any stipulations in this specific contract that seem to favor the furniture store is arguably necessary in these high risk furniture store dealings. The furniture store is taking the risk when by letting the customers have physical possession of the items, while the item is not payed off. Due to this risk the furniture store needs to have certain stipulations in their contract to protect themselves not only from transactions with individuals but for overall survival of the business. What you're referring to as "obscure" , any reasonable person would call sagacious. Plus, even if it were the case that the terms of the contract were obscure, which they weren't, Williams knew the terms before signing the contract and she choose to sign it so the culpability is on her. Williams is the one that that broke her side of the contract and defaulted on a payment, a contract that she probably should have never signed in the first place, not because the terms were obscure, since they weren't, but because she knew she had a big family to take care of and she should have known there was a big chance she couldn't afford the stereo. In your argument you're manipulating the meaning of "meaningful choice".
Debate Round No. 2
Hotlegal

Pro

The fact that the Walker-Thomas Furniture store is able to obtain an additional $12,200.00 from Williams for items valued at $1,800.00 based on the terms and conditions of the contract is a Prima Facie "loan sharking" contract. While it is common in this type of "Rent-a-center" business to protect its interest and business survival, it is unconscionable to charge more than 6 times the value of an item. What specifically makes the contract terms obscure, are the terms regarding the collective security of all purchases, "and all payments now and hereafter made by [purchaser] shall be credited pro rata on all outstanding leases, bills, and account due". This term is forcing Williams to keep balance until she can pay her account balance in full. We see as a result of this term Williams has paid out an additional $12, 200.00 more than the amount of her original purchase price. As an example, if Williams makes a purchase today for $50.00 and makes her required $25.00 monthly installment and purchase another item for $100.00 and subsequently makes her required $25.00 monthly installment payment Williams would have paid for the total amount for the first item, but because she made the $100.00 purchase that $50.00 and the $100.00 item would be in jeopardy of repossession by Walker-Thomas should William miss any subsequent required $25.00 installment payment despite the fact that Williams did pay the purchase price of the first item. The obscure term can be argued to be unconscionable based on Williams financial status and that she did not have a meaningful choice in the matter but to accept the terms of the contract in order to make purchases apparently over the course of 5 years as a customer of Walker-Thomas Furniture. As would any sagacious business savvy company check the credit worthiness of an installment paying customer; Walker Thomas Furniture knew Williams financial status and her family composition. The "rent-a-center" type businesses are based on the fact that there are people who cannot afford to pay for items in full and will require to make installment payments. In this instance the terms of the contract are obscure in that it craftily increases the price of any installment purchased items and holds hostage previously purchased items until the purchaser can reach a zero account balance. The obscure term and the resulting significant over payment for items purchased on installment payments makes the contract unconscionable.
randysanichara

Con

There is a reason standard form contracts exist. It's completely unreasonable for anyone to expect that in a business like the furniture store business that they could make specific contracts for each individual transaction by factoring each individual customers situation. The standard form contract keeps everything simple, fair, and equal which is safe and smart when running a business. Once again unconscionably has to do with absence of meaningful choice on the part of one of the parties and that meaningfulness of the choice is negated by a gross inequality in bargaining power. If we look at each party individually, the furniture store has a choice in what terms are in its contact and since furniture is arguably not a necessity they don't have bargaining power. If we look at Williams, she has the choice of whether or not to sign the contract, purchase the stereo, and she even has the choice of what furniture store to shop from. The point is that she had plenty of choice and because of that, the interest rates are irrelevant in this case when talking about unconscionably. Therefore the case should be decided in favor of the Walker-Thomas furniture store.
Debate Round No. 3
Hotlegal

Pro

You are absolutely correct in that the Furniture store has the authority to select the terms that the Standard Form contract would contain. It can be argued that the Furniture store selected the most obscure terms to confuse the specific customer base that would be more than likely to use this "Rent-a-Center" form of purchasing. With the expectation that this constituent base would either lack the educational level to understand the terms or would be in a situation wherein they would feel they are left no other option, or bargaining power to balance out the effects of the obscure terms based on the fact that it is a Standard Form Contract which cannot be negotiated. Absence any additional facts presented in this fact pattern it cannot be determined if Williams had any other options to select another store within her locale or if there was the option of another furniture store which offered the same "Rent-a-Center" type purchasing. So while it appears that Williams made the conscience decision to sign the contract without more facts we cannot determine if there was any other alternative which would give Williams bargaining power to effectively equalize the contract terms to not be one sided in favor of the Furniture Store. As such, I will agree with the Courts holding in this instance to remand for further consideration and investigation of pertinent facts to make the final determination.
randysanichara

Con

There are also no facts to support the claim that the furniture formed their contract in the way that they did because they wanted to trick their customers. Plus it's completely ridiculous to imply that, that was their intention. If someone didn't undercurrent a contract but they chose to sign it then they are still responsible for their side of the contract. Even if we accept that she didn't have another store to go to, she still didn't necessarily have to but a contract. That is one choice that she made that is in the facts and that can't be refuted. At the end of the day she violated the terms on a contract that she chose to sign and she should have to face the consequences.
Debate Round No. 4
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