On November 23, 2021, Justice Reed of the New York County Commercial Division issued a decision in Estate of Collins v. Tabs Motors of Val. Stream Corp., 2021 NY Slip Op. 51127(U), rejecting an unconscionability defense, explaining:
To establish procedural unconscionability, a party must show certain elements during the transaction such as deceptive or high-pressured tactics, the use of fine print in the contract, a lack of experience and education and a disparity in bargaining power. Petitioner Michael Louros and third-party defendants argue that the contract is procedurally unconscionable because respondent Steven Louros was allegedly deceptive by withholding or not fully disclosing relevant information, and that there is a difference in sophistication of the parties. Petitioner and third-party defendants’ claim of deception, however, is not supported by fact. The fact that Steven Louros is the only lawyer in the family does not in itself render the contract procedurally unconscionable. Petitioner Michael Louros and third-party defendants had 18 months to consult an attorney and to examine the terms of the Shareholders Agreement on their own. There is no issue of fact regarding procedural unconscionability.
For a contract to be found substantively unconscionable, the terms must be unreasonably favorable to one party. Here, the Shareholders Agreement does not unreasonably favor Steven Louros. The Shareholders Agreement applies equally to any shareholder who petitions for dissolution. Also, the set share price is fair. It is not deeply discounted. In fact, the fixed value is nearly double the Corporation’s appraised value two years before the shareholders signed the Shareholders Agreement. There is no procedural or substantive unconscionability.
(Internal citations omitted).