A friend sent me this lecture and we have argued about a question raised in the second half of this lecture about contracts.
The example in the lecture has some tricky aspects so I have simplified the problem for discussion as follows…
A contractor sells his services for an unreasonable price.
The contractor knows his price is unreasonable.
The purchaser is naive but of sound mind and pays the contractor his unreasonable price.
The question is – is a third party (e.g. a Judge) justified in taking the money (less a reasonable fee for the contractor’s services) from the contractor and returning it to the purchaser?
In the lecture example the unreasonable price was extremely unreasonable.
Should the degree of unreasonableness be a consideration?