What is an "adhesion contract"?

An adhesion contract is indeed characterized as a standardized contract that is presented on a "take it or leave it" basis. This means that one party, typically the stronger or more knowledgeable party, drafts the contract terms, and the other party has little to no ability to negotiate those terms. This type of contract is common in situations where there is a significant disparity in bargaining power, such as in consumer contracts for goods or services where one party is at a distinct advantage—for example, when a large company provides a contract for a product or service.

The defining characteristic of adhesion contracts is the lack of negotiation in the acceptance of terms, which can lead to concerns about fairness and can invoke consumer protection considerations. Courts may sometimes scrutinize these contracts, especially if they contain unconscionable terms that heavily favor the drafting party.

The other options provide different scenarios that do not accurately reflect the nature of adhesion contracts. For example, contracts where both parties negotiate terms equally describe mutual agreements, not adhesion contracts, while limited rights pertain to the legal standing of a party rather than the nature of the contract itself. Lastly, mutual consent is a fundamental principle of all contracts, not specific to adhesion contracts. Thus, recognizing adhesion contracts as ones with non-negotiable terms