Has Any Consumer Ever Read a Service or Installment Contract?

If you were to ask average consumers whether or not they realize that they had agreed to waive their right to sue or join in a class action and agreed to arbitration, they probably would not know what you were talking about. Everyone (myself included) scrolls to the bottom and checks "I accept" or signs, if on paper, without ever reading the terms and conditions of an installment sale or service contract. Even if someone chooses to read the contract and objects to some of its terms, there is no bargaining involved. No acceptance -- no agreement -- no service -- no sale.

So what does the consumer with a legitimate, small claim do against a giant corporation? According to the Supreme Court (and for the second time) -- "forgetaboutit". (N.Y. Times 12/15/15 Supreme Court Rules DirectTV Customers Must Use Arbitration, Not Class Action) Customers who have small and identical claims and who otherwise meet the criteria for a class action cannot band together, but must pursue individual arbitration -- which, in essence, means that many small claims will not be pursued and the offending companies will avoid liability and accountability for fraud or defective products. The Supreme Court has held that even attempts by state legislatures to correct the situation and protect consumers are inconsistent with its prior rulings declaring that arbitration clauses pre-empt class actions.

This is one of those cases in which the result feels so wrong but the reasoning seems right -- or at least understandable. We have extolled the virtues of arbitration versus law suits (although no longer so virtuous in practice). We depend upon the enforcement of the written word in our contracts. But the question remains: What to do when the contracts are written by and for the benefit of corporations -- the sellers of products and services; the reality is that the consumer has no bargaining position and does not read or understand the terms and their implications; and valuable rights are destroyed in the process to the detriment of the consumer? One would assume that the answer would lie in appropriate legislation, but the Supreme Court seems to suggest that it would reject legislative attempts to protect the consumer from such an outcome. As it stands now, the small guy with the small claim loses to the big guy without ever having the chance to prove his claim, because to do so would cost more in time and expense than the claim itself.