We own and operate medical clinics in South Florida providing elective cosmetic surgery. Our patients are usually in good condition without major health issues. Large increases in malpractice cases, jury awards and liability insurance premiums have led to many doctors leaving the field entirely or seeking better ways to run their practices. Our standard business strategy requires patients to sign medical releases before any services will be performed. We know our form doesn't release us from claims of negligence. It requires claims to be decided by an arbitration panel rather than by courtroom litigation. A few of our lawyer-patients have suggested that we may have trouble enforcing it. What's the problem?

Your question concerns an unsettled area of the law involving ''unconscionable'' contracts. They sometimes result when one of the parties has been so exploited that enforcement of the agreement they were required to sign would ''shock the conscience of the court.'' These agreements are often called contracts of adhesion, preprinted on standardized forms that require one party to adhere to their terms on a take-it-or- leave-it basis with no opportunity to negotiate. In addition, the critical facts of these disputes usually show that extreme unfair advantage has been taken of the signing party, rather than just their attempt to escape a bad business deal.

Unconscionability claims are commonly made by borrowers who want to be excused from a promissory note or other financing obligation due their lender or a party who gives a receipt for less than the amount due them on a contract and then tries to recover the balance, and of course, disputes about legal enforceability of surgical medical releases when the patient decides to sue.

Now let's look at these legal rules in the light of your question. Your ''arbitration only'' release is a sound business strategy. Even if there was a successful negligence claim against you, arbitration awards are usually much lower than court judgments. Arbitration is also cheaper and faster than litigation. The most important advantage is that the proceedings are private, so that adverse publicity is minimized.

But is it legally enforceable? Probably yes. Your medical specialty of elective cosmetic surgery is, by its very nature, a voluntary option of the patient. Even if a patient's required signing of your surgical medical release form satisfied the first two legal elements of unconscionability, the third requirement of ''no other choice'' isn't satisfied the way it would be in life-threatening surgeries or other medical emergencies. The patient properly trades the right to litigate a dispute for your consenting to do the contracted procedure.

Here's a case where a surgical medical release was declared unconscionable. In Broemmer v. Abortion Clinic of Phoenix, Ltd., 840 P.2d 1013 (Az. 1992), a four-months-pregnant, unmarried 21-year-old who worked at a minimal $100 per week job with no medical benefits was conflicted about whether or not to get an abortion. Her family said no and the father-to-be said yes.

The plaintiff eventually decided to proceed, went to the defendant's clinic and was required to complete a set of preprinted forms that included an agreement to arbitrate, stating that any dispute would be settled by arbitrators who were licensed medical doctors specializing in obstetrics and gynecology. The forms written in legalese weren't explained to her, she completed them in five minutes without reading them, and her abortion was scheduled for the next morning.

We recently attended the Consumer Electronics trade fair in Las Vegas for our computer business. We also saw some casino shows featuring well-known celebrity performers. At one of these our group went backstage to meet singer Celine Dion, who was mobbed by her fans. They were yelling her name, asking for autographs and shoving pieces of paper in front of her to sign. One of my wife's brothers, as a joke, had Celine sign a blank check that he later filled in payable to himself for $1 million. He kept it as a souvenir. But what if he tried to enforce it against her? Aren't there legal reasons why this isn't allowed?

The answer to your question is the legal remedy of fraud, but there are two types. The most common one is called ''fraud in the inducement.'' It makes transactions voidable at the election of a victimized party, who claims that the reason why they signed a contract or verbally entered into the agreement was due to calculated deception by the defendant. Common examples are consumer scams, con games and other misrepresentations of material facts by the defendant on which the plaintiff reasonably relies to their financial detriment.

The other kind is called ''fraud in the execution,'' also known as ''fraud in the inception.'' It relates to the genuineness of the contract document itself -- what you sign instead of why you sign it. This type of fraud makes the transaction void, illegal and unenforceable from its beginning.

The situation in your question is clearly a case of fraud in the execution. Even though the check bears the signature of the celebrity, she didn't intend to sign it and wouldn't have if she had known its true identity. The law treats the transaction as a nullity. In addition, because this type of fraud is so obviously unlawful, the victim is often allowed to recover money damages in addition to the standard remedy of contract cancellation in order to punish the offending party.

Ask Doctor Law appears in every other edition of Business Monday. Send your questions to askdoctorlaw@Miami Herald.com. Martin E. Segal, a licensed attorney, lectures in business law at the University of Miami. Visit him at www.dr-law.com .

Disclaimer: This column is not intended to be a solicitation of legal business or the furnishing of self-help legal advice. Laws vary from state to state. Readers are strongly urged to consult independent and qualified legal professionals before making any business decisions. The views expressed are those of the writer and not of The Miami Herald.

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