What is Standard form contract?

What is Standard form contract?

standard form contract (sometimes referred to as a contract of adhesion, a leonine contract, or a take-it-or-leave-it contract) is a contract between two parties, where the terms and conditions of the contract are set by one of the parties, and the other party has little or no ability to negotiate more favorable terms and is thus placed in a "take it or leave it" position.

While these types of contracts are not illegal per se, there exists a very real possibility for unconscionability. In addition, in the event of an ambiguity, such ambiguity will be resolved contra proferentem against the party drafting the contract language.

As a general rule, the common law treats standard form contracts like any other contract. Signature or some other objective manifestation of intent to be legally bound will bind the signor to the contract whether or not they read or understood the terms. The reality of standard form contracting, however, means that many common law jurisdictions have developed special rules with respect to them. In general, in the event of an ambiguity, the courts will interpret standard form contracts contra proferentem against the party that drafted the contract, as that party (and only that party) had the ability to draft the contract to remove ambiguity.


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