Muhammad v. County Bank
New Jersey Supreme Court
912 A.2d 88 (2006)
Jaliyah Muhammad (plaintiff) borrowed $200 from County Bank (defendant) at a 608.33 percent annual percentage rate, extending the short-term loan twice and incurring additional $60 finance charges each time; each loan and extension required her to sign contracts mandating arbitration and barring both class arbitration and class-action lawsuits. Muhammad brought a putative class action alleging County Bank charged an illegal interest rate, and the trial court stayed the case pending arbitration, a ruling affirmed by the appellate court before Muhammad sought further review.
Whether specific terms in a contract of adhesion that are both procedurally and substantively unconscionable will be deemed unenforceable.