This website uses cookies to ensure you get the best experience on our website. Learn more

Alec Lobb (Garages) v Total Oil (Great Britain) Ltd [1985] 1 All ER 303

By Oxbridge Law TeamUpdated 04/01/2024 07:00

Judgement for the case Alec Lobb (Garages) v Total Oil (Great Britain) Ltd

Table Of Contents

  • Defendant loaned Plaintiff some money and took mortgages on Plaintiff’s property as security. When Plaintiff got into financial trouble, Defendant (contrary to its solicitors’ advice) agreed to lease Plaintiff property for  one-off premium and a v. low rent in return for which Plaintiff would grant a lease-back at a normal rent and supply Defendant with petrol for the whole term of the lease-back.

  • Plaintiff claimed that this was an unconscionable bargain because of the unequal bargaining power at the time of the agreement and should be set aside.

  • CA denied this claim. 

Dillon LJ

  • There was unequal bargaining power (i.e. weakness of Plaintiff) but Defendant did no take advantage of this by using its power coercively or in a usurous way etc and therefore there is no presumption of fraud as there was in Aylesford.

  • The unequal bargaining power requirement is fulfilled despite Plaintiff having legal advice, since it had no other source of getting finance, Defendant did not want to accept any other terms, it was in financial difficulty etc. Mere presence of advice doesn’t change this.

  • However Defendant was not oppressive in its use of power.

  • For a deal to be shown to be “unconscionable”, it has to be more than merely “unreasonable”. Thus, here, it is unnecessary for Defendant to show that the transaction was “fair, just and reasonable”, since Plaintiff has not done enough to raise the presumption of fraud. 

Any comments or edits about this case? Get in touch

For Further Study on Alec Lobb (Garages) v Total Oil (Great Britain) Ltd

Need instant answers? Our AI exam tutor is here to help.

Ask questions 🙋 Get answers 📔 It's simple 👁️👄👁️

Our AI is educated by the highest scoring students across all subjects and schools. Join hundreds of your peers today.

Get Started

Related Product Samples

These product samples contain the same concepts we cover in this case.

Claim every advantage to get a first in law
Contract Law Notes
1,511 total pages
746 purchased

Contract law notes fully updated for recent exams at Oxford and Cambrid...