CIV § 1670.5

Courts May Refuse Unconscionable Contracts - CIV § 1670.5

Courts may refuse to enforce unconscionable contracts or limit unconscionable clauses, and parties shall be afforded opportunity to present evidence.

Official text CIV § 1670.5 — California
  • (a) If the court as a matter of law finds the contract or any clause of the contract to have been unconscionable at the time it was made the court may refuse to enforce the contract, or it may enforce the remainder of the contract without the unconscionable clause, or it may so limit the application of any unconscionable clause as to avoid any unconscionable result.
  • (b) When it is claimed or appears to the court that the contract or any clause thereof may be unconscionable the parties shall be afforded a reasonable opportunity to present evidence as to its commercial setting, purpose, and effect to aid the court in making the determination.

Text as published in the 2026 snapshot of the code.

Source: Vaquill Open US Law, compiled from official state publishers (huggingface.co), reproduced under license CC BY 4.0.

Read this provision at the official source →

What it actually says

Section 1670.5 gives a court three options rather than one. Subdivision (a) provides that if the court finds, as a matter of law, that the contract or any clause of it was unconscionable at the time it was made, the court may refuse to enforce the contract, or enforce the remainder without the unconscionable clause, or so limit the application of the clause as to avoid any unconscionable result. That graduated remedy is why an unconscionability finding does not usually destroy the agreement: the ordinary outcome is that the offending clause is severed or read down.

Two phrases fix the test. "As a matter of law" makes it a question for the judge, not the jury. "At the time it was made" makes it a question about formation, not about how things turned out: a bargain that became a bad one is not unconscionable, and a clause that has never yet been invoked can be. California courts apply the doctrine as requiring both procedural unconscionability — oppression or surprise in how the contract came about, typically a form contract presented on a take-it-or-leave-it basis — and substantive unconscionability — terms that are overly harsh or one-sided — on a sliding scale, so a great deal of one reduces how much of the other is needed.

Subdivision (b) is procedural and easy to overlook: where it is claimed or appears to the court that a contract or clause may be unconscionable, the parties must be afforded a reasonable opportunity to present evidence as to its commercial setting, purpose and effect. The doctrine is therefore decided on evidence about how the term came to be there and what it does, not on the bare words. Section 1668 is the neighbouring provision for clauses that exempt a party from responsibility for fraud, willful injury or violation of law. Whether a term in your contract is vulnerable is a question to take to a lawyer with the whole document.

When it applies

  • A one-sided arbitration clause in a form contract you could not negotiate
  • A term buried in small print on the back of a document
  • A gym, phone or service contract with a punishing cancellation regime
  • A clause that gives all the remedies to one side and none to the other
  • A consumer form contract offered on a take-it-or-leave-it basis
  • Terms presented in a language or a format you could not realistically read

What this section does not say

  • It is not about the deal turning out badly. The test is unconscionability at the time the contract was made, not later regret or changed circumstances.
  • A hard bargain is not unconscionable. California courts require both procedural and substantive unconscionability, on a sliding scale, not merely a term that favours the other side.
  • It does not usually void the contract. Subdivision (a) allows severance of the clause or limiting its application, and that is the ordinary outcome.
  • It is not decided on the wording alone. Subdivision (b) requires the parties to be given a reasonable opportunity to present evidence about the commercial setting, purpose and effect.
  • It is not a general fairness review. The section does not let a court rewrite a price or reallocate a risk simply because the result seems unfair.

Worked examples

Invented situations, written to show how the wording bites. They are not real cases, not judgments and not precedent, and nothing here predicts what would happen in yours.

Illustrative example

Someone signs up at a studio on a tablet at the counter, agreeing to terms shown behind a link. The terms turn out to require twelve months of payments in full on any cancellation, with no equivalent obligation on the studio if it withdraws the class.

How the wording applies

Unconscionability under section 1670.5 needs both a procedural element, meaning how the term was presented and whether it could be negotiated, and a substantive one, and the two trade off against each other on a sliding scale. The fact this hinges on is the asymmetry: the same event releases the studio and binds the member, which is what makes the term more than merely unfavourable.

How the parties settled it

The member pays a cancellation sum equal to the studio's actual lost cost over a short notice period, and the studio adds a matching exit right for itself in its published terms.

Illustrative example

A customer of a service business is told that any dispute must go to arbitration in a distant county with the customer paying the arbitrator's fee, while the business keeps the right to go to court to collect money owed.

How the wording applies

The section allows a court to refuse to enforce a clause, to sever it, or to limit its application, and severance is the ordinary outcome rather than voiding the contract. It turns on whether the clause binds only one side: a mutual arbitration agreement on neutral terms is a very different document from one that sends the customer to arbitration and keeps the courts for the business.

How the parties settled it

Both sides agree to mediate first and, failing that, to arbitrate locally with the fees split, replacing the original clause by written amendment.

How courts have read it

Decisions construing this provision. The question and the summary are ours; the quoted sentence is the court's own words, taken from the published opinion. These are the decisions in our corpus, not every decision there is, and nothing here predicts any other case. Reported 1991 to 2017.

Carbajal v. CWPSC, Inc., 245 Cal. App. 4th 227 (2016)

Court of Appeal

What the court had to decide

Did the trial court properly find the arbitration agreement unconscionable under Civil Code § 1670.5?

What it held

The trial court properly found the arbitration agreement unconscionable, and the court of appeal agreed, affirming the denial of the motion to compel arbitration.

In the court's words
The Trial Court Properly Found the Arbitration Agreement to Be Unconscionable

Grand Prospect Partners v. Ross Dress for Less, Inc., 232 Cal. App. 4th 1332 (2015)

Court of Appeal

What the court had to decide

Were the cotenancy provisions in the commercial lease unconscionable under Civil Code section 1670.5?

What it held

The court held that there was no procedural unconscionability, and therefore the cotenancy provisions were not unconscionable under section 1670.5.

In the court's words
As to unconscionability, which requires proof of both procedural and substantive unconscionability, we conclude the evidence establishes there was no procedural unconscionability.

Sonic-Calabasas A, Inc. v. Moreno, 57 Cal. 4th 1109 (2013)

Supreme Court of California

What the court had to decide

Whether the Federal Arbitration Act preempts a state law rule categorically prohibiting waiver of a Berman hearing in a predispute arbitration agreement, and whether such an agreement may still be found unconscionable under Civil Code section 1670.5 if it is unreasonably one-sided.

What it held

The FAA preempts the categorical rule prohibiting waiver of a Berman hearing, but state courts may still enforce unconscionability rules under section 1670.5 that do not interfere with fundamental attributes of arbitration, and an arbitration agreement may be unconscionable if it is otherwise unreasonably one-sided in favor of the employer.

In the court's words
Although a court may not refuse to enforce an arbitration agreement imposed on an employee as a condition of employment simply because it requires the employee to bypass a Berman hearing, such an agreement may be unconscionable if it is otherwise unreasonably one-sided in favor of the employer.

Bigler v. Harker School, 213 Cal. App. 4th 727 (2013)

Court of Appeal

What the court had to decide

Whether the arbitration provision in the enrollment contract was unconscionable and therefore unenforceable under Civil Code §1670.5.

What it held

The court held that the arbitration provision was valid and not unconscionable, and that all of Shivani's tort claims are subject to arbitration under its broad language.

In the court's words
Having independently considered these issues in light of the record, we agree with Harker that the arbitration provision is valid and applicable to the tort allegations.

Facter v. Facter, 212 Cal. App. 4th 967 (2013)

Court of Appeal

What the court had to decide

Did the trial court err in refusing to sever the invalid provisions of the premarital agreement instead of enforcing the remainder?

What it held

The trial court erred in refusing to sever the invalid provisions from the balance of the contract; the valid parts should be enforced.

In the court's words
We concur with Jeffrey, however, that the court erred in refusing to sever the Agreement’s invalid provisions from the balance of the contract.

Zullo v. Superior Court, 197 Cal. App. 4th 477 (2011)

Court of Appeal

What the court had to decide

Whether the arbitration agreement in the employee handbook was unconscionable and therefore unenforceable under Civil Code section 1670.5.

What it held

The arbitration agreement is unconscionable and cannot be enforced as written because it is a contract of adhesion, fails to give adequate notice of the arbitration rules, is one-sided, and imposes unfair time limits.

In the court's words
Accordingly, the arbitration agreement is unconscionable and cannot be enforced as written.

Source: Caselaw Access Project, CC0 1.0 Universal (public domain dedication).

Related sections

CIV § 1668 Contracts exempting liability for fraud: CIV § 1668 CIV § 1671 Liquidated damages valid unless unreasonable - CIV § 1671 CIV § 1953 Certain tenant waivers in leases are void: CIV § 1953

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We copy this text from the official publisher and re-check it against that source on every page load, but we cannot guarantee it is complete, current or free of error, and we accept no liability for any reliance on it. An amendment can take effect before a consolidation catches up. The publisher's own copy is linked below; where the two differ, it is the official one that counts.

This page reproduces the text of CIV § 1670.5 in force at the date shown and explains it in general terms. It is not legal advice and takes no account of the circumstances of your case, which can change the answer completely. For a live dispute, for limitation periods, and before taking any step in court, consult a qualified lawyer in California.

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