Which statement best describes the enforceability of a contract of adhesion?

Study for the New Jersey Title Insurance Producer Exam. Study with flashcards and multiple-choice questions, each question has hints and explanations. Get ready for your exam!

A contract of adhesion is characterized by one party providing all the terms and conditions, while the other party has little to no opportunity to negotiate those terms. This commonly occurs in standard form contracts, such as insurance policies, consumer agreements, or any situation where one party dictates the terms due to superior bargaining power.

The enforceability of a contract of adhesion can indeed come into question if the terms are found to be excessively one-sided, potentially making them unconscionable. Courts may scrutinize such contracts to ensure they do not impose unfair obligations or deprive the weaker party of important rights. If a court determines that the contract’s terms create an imbalance that is unfair or oppressive, it may rule the contract or specific terms within it as unenforceable.

This principle recognizes the need for fairness and justice in contracts, especially when acknowledging potential disparities in bargaining power. It highlights the legal system's commitment to preventing exploitation that could arise from giving uncontrolled power to one side in the contractual agreement.

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