Consumer Rights

Unconscionable Contracts: When a Deal Is Too Unfair to Enforce

Signing a contract usually binds you. But a deal that is grossly unfair, made when you had no real choice, may not be enforced.

Groom in tuxedo signing wedding documents with a smile

A contract can be set aside as unconscionable when it is grossly unfair and one side took advantage of an inequality of bargaining power.

The short answer

The Supreme Court of Canada, in Uber v. Heller (2020), said a contract is unconscionable if there was an inequality of bargaining power and the result was an improvident (unfair) bargain.

The two parts

  1. Inequality of bargaining power: for example, a standard-form contract with no chance to negotiate, a person in distress, or a person who didn't understand the terms.
  2. An improvident bargain: the terms unduly favour the stronger party, judged at the time the contract was made.

Examples

  • An arbitration clause that costs more than the claim is worth (as in Uber).
  • A loan or sale on wildly unfair terms to someone who couldn't understand it.

Consumer protection

grayscale photo of concrete pillars

Ontario's Consumer Protection Act also lets consumers cancel agreements made through unfair practices, including unconscionable representations, often within one year.

What to do

  • Keep the contract and any messages about it.
  • Write down how it was signed (pressure, language, time given).
  • Get advice before you stop paying.
Talk to NEO

Need help with a consumer dispute? NEO can help you write a demand letter, or bring or defend a claim in Small Claims Court. Call 647-200-3526 or toll-free 888-519-2435, email info@neolegalservices.com, or book a free consultation.

Sources

Read next: Contracts With People Under 18 in Ontario

General Ontario legal information, not legal advice for your matter, and reading it does not create a retainer. Sources checked 16 October 2026: check the current law, forms and dates before you act.

Photos from Unsplash: Groom in tuxedo signing wedding documents with a smile · grayscale photo of concrete pillars.

This article is general information for people in Ontario, not legal advice. Rules, forms and deadlines change, and every situation is different. Check the current rule or speak to a licensed legal professional before you act.

Not sure where you stand? A licensed paralegal can look at your documents and tell you your options.

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Law Society of Ontario — Barreau de l'Ontario
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