Say you buy a software. There is a term in the term of service that you got to pay $1 million dollar/become sex slaves, etc.

To what extend companies can do that?

There are 2 cases where something like this happen in real life.


In Sim Lim case, somewhere hidden in the contract there is a writing that user agrees to pay $30*12 insurance fee.

Why they write $30*12? Why not write $3600? Yea it's there to deliberately make the fee unclear. Unsuspecting user sign and is reduced in tear.

In Indonesia, many insurance agency would write that there is acquisition fee of say 100% from basic premi. They didn't write the dollar amount. They write it in terms of percentage.

That acquisition fee can be 100 times higher than the normal price of insurance if bought separately.

Most customers do not even know they have high premium. Their agent simply say that all money are invested.

Indonesian lawyers say it's legal and common in insurance industry in Indonesia. I've heard it's common in unit link in other countries too. Is it?

What defense do we have against such companies?

  • Your first and best line of defense against agreeing to a bad contract is reading the contract. – IllusiveBrian Jan 31 '18 at 16:58
  • FWIW, the question you really want to ask is whether the company can enforce this contract of adhesion. Writing an unenforceable contract is rarely actionable in and of itself. – ohwilleke Feb 1 '18 at 0:09
  • In the case of sim lim, the shop simply rack in tons of profit from unsuspecting people not reading the contract carefully. It's not until the issue is exposed by media that the practice stop. – user4951 Feb 1 '18 at 2:18

The first defense would be to read the contract and see what is required of the customer. If you do not understand what 30*12 means, you should not sign the contract until you get it spelled out. If you are required to pay 100% of "the premium", you need to find out what that amount is. If the contract requires you to pay a million dollars for an apple or serve as a sex slave, you also should not sign the contract. If the contract is written in Javanese and you don't speak Javanese, you should hire a competent lawyer who can give you advice, or, of course, only sign a contract that you can understand. There is never any requirement that you agree to someone's terms: if you don't like the terms, forego whatever it is that they are offering you.

In the case of the million dollar apple, you can also seek to have the contract voided under the doctrine of unconsionability (see Williams v. Walker-Thomas, 350 F.2d 445). Especially in the case of sex-slavery, such a contract probably cannot be enforced anywhere, since in general, contracts cannot require people to do something illegal, nor can they require a person to abandon fundamental rights (first-born son or suicide are not enforceable terms).

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  • Of course. The thing, as in sim lim case, the contract is quite big. And the adversarial term is deep within the contract. – user4951 Jun 19 '18 at 20:53
  • Most people do not even read terms when signing things up on website. In Acai Berry scam, FDC declares that it's a scam, and bleed them. huffingtonpost.com/judith-j-wurtman-phd/… So there is something governments do. – user4951 Jun 19 '18 at 20:57

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