Legal Definitions - adhesionary contract

An adhesionary contract, often simply called an adhesion contract, is a standardized agreement drafted by one party (typically a business or organization) and presented to another party (often a consumer) on a "take-it-or-leave-it" basis. The party presenting the contract has significantly more bargaining power, and the other party has little to no ability to negotiate the terms or clauses within the agreement. To enter into the transaction, the weaker party must simply "adhere" to the terms as written, without modification.

Here are some examples to illustrate this concept:

• Software End-User License Agreement (EULA): When you download and install new software on your computer or smartphone, you are typically presented with a lengthy End-User License Agreement. Before you can use the software, you must click "I Agree" to accept all the terms and conditions, which often cover usage rights, data collection, and limitations of liability. You cannot negotiate to remove specific clauses, such as those related to data sharing or arbitration. You either accept the entire agreement as presented by the software company or you cannot use the software. This demonstrates an adhesionary contract because you, as the user, have no power to alter the terms and must simply adhere to them.

• Standardized Apartment Lease: Imagine renting an apartment from a large property management company. The company provides a pre-printed, standard lease agreement that all tenants must sign. While you might discuss the move-in date or specific parking arrangements, core clauses regarding rent increases, pet policies, late fees, or maintenance responsibilities are typically non-negotiable. The property management company, with its significant market power and standardized operations, dictates the terms, and you, as the prospective tenant, must accept them in their entirety or seek housing elsewhere. This exemplifies an adhesionary contract due to the lack of bargaining power on the tenant's part.

• Mobile Phone Service Contract: When you sign up for a new mobile phone plan with a major telecommunications provider, you are presented with a contract detailing monthly charges, data limits, early termination fees, and dispute resolution clauses (like mandatory arbitration). You cannot negotiate to remove the early termination fee or alter the arbitration clause to allow for class-action lawsuits. The provider, being a large entity, offers its services under a standard set of terms, and you, as the consumer, must accept these terms as a whole to obtain the service. This is an adhesionary contract because you adhere to the provider's pre-determined conditions without the ability to negotiate individual provisions.