With respect to a consumer credit agreement, if the court finds the agreement or any part of the agreement to have been unconscionable at the time it was made, the court may refuse to enforce the agreement, or it may enforce the remainder of the agreement without the unconscionable clause if that will avoid any unconscionable result.
Terms Used In Utah Code 70C-7-106
Agreement: means the bargain of the parties in fact as stated in a written contract or otherwise as found in the parties' language or by implication from other circumstances, including:
Contract: A legal written agreement that becomes binding when signed.
Contract: means a document containing written terms and conditions of a credit agreement. See Utah Code 70C-1-302
Creditor: means :
(i)
a party:
(A)
who regularly extends consumer credit that is subject to a finance charge or is payable by written agreement in more than four installments, not including a down payment; and
(B)
to whom the obligation is initially payable, either on the face of the note or contract, or by agreement when there is no note or contract;
(ii)
an issuer of a credit card that extends either open-end credit or credit that:
(A)
is not subject to a finance charge; and
(B)
is not payable by written agreement in more than four installments; and
(iii)
an issuer of a credit card that extends closed-end credit that:
(A)
is subject to a finance charge; or
(B)
is payable by written agreement in more than four installments. See Utah Code 70C-1-302
Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
Party: means an individual and any other entity legally capable of entering into a binding contract. See Utah Code 70C-1-302
Remainder: An interest in property that takes effect in the future at a specified time or after the occurrence of some event, such as the death of a life tenant.
(2)
If it is claimed or appears to a court that a consumer credit agreement or any part of it may be unconscionable, the parties shall be afforded a reasonable opportunity to present evidence as to its setting, purpose, and effect to aid the court in making the determination.
(3)
For the purposes of this section, a charge or practice expressly permitted by this title is not in itself unconscionable.
(4)
If the court as a matter of law finds a consumer credit agreement or any part of the agreement to have been unconscionable, then in addition to the relief provided for in Subsection (1), the party in violation of this section is liable and the debtor may recover from it a penalty in an amount determined by the court of:
(a)
not less than $100 nor more than $5,000; and
(b)
the cost of the action together with a reasonable attorney’s fee.
(5)
The penalties provided for in Subsection (4) may not be imposed upon an assignee of the creditor‘s rights in a consumer credit contract found as a matter of law to be unconscionable in whole or in part unless the debtor establishes by a preponderance of the evidence that the assignee knew the agreement was a consumer credit contract at the time the assignment occurred and also knew of the facts or circumstances on which the court based its finding of unconscionability.
(6)
No class action may be brought under this section except for injunctive or declaratory relief.
(7)
Nothing contained in Subsection (6) prevents the recovery of penalties by a debtor as provided in Subsection (4).
