## Facts

- The case involved the sale of a reversionary interest by two young men who had recently reached the age of majority.
- The sellers received a sum significantly below the actual value of the reversionary interest.
- The young men lacked business experience and did not receive independent legal advice regarding the transaction.
- The purchasers were found to have exploited the sellers' vulnerability and lack of understanding about the value of the interest.
- The court rescinded the sale on the basis that the agreement was an unconscionable bargain.

## Issues

1. Whether the vulnerability of the sellers and absence of independent advice rendered the contract unconscionable.
2. Whether a significant disparity between the contract price and actual value constituted grounds for equitable intervention.
3. Whether the doctrine of unconscionable bargains should offer relief where one party takes unfair advantage of another’s poverty and ignorance.

## Decision

- The court found the contract to be unconscionable due to the combination of the sellers’ poverty, ignorance, and lack of independent advice.
- It held that a substantial inadequacy of consideration supports a finding of exploitation.
- The court granted rescission of the contract to protect the vulnerable parties.

## Legal Principles

- Unconscionable bargains may be set aside where one party is “poor and ignorant” and lacks independent advice.
- A clear inadequacy of consideration is strong evidence of unfair dealing, especially when combined with procedural disadvantages.
- The court’s equitable jurisdiction allows intervention to prevent injustice where contracts are formed under significant disadvantage or exploitation.
- Subsequent case law has further emphasized the requirement that the stronger party must actively exploit the weaker party’s position, in addition to procedural and substantive unfairness.

## Conclusion

Fry v Lane (1889) 40 Ch D 312 established key principles of the doctrine of unconscionable bargains, permitting equitable relief where contracts arise from exploitation of a vulnerable party, particularly in the absence of independent advice and with substantial undervaluation. These principles continue to guide courts in protecting individuals from unfair contractual agreements.
