Commercial Bank of Australia Ltd v Amadio,[1] is a seminal case in Australian contract law and equity, in which the High Court held that unconscionable dealing due to a lack of knowledge or education and the consequent imbalance in bargaining power could lead to a transaction being set aside.

[3] The Amadios commenced proceedings in the Supreme Court of South Australia seeking to set aside the mortgage and guarantee.

Notable circumstances taken into the account by the court include: Justice Mason noted: "Relief on the ground of unconscionable conduct will be granted when unconscientious advantage is taken of an innocent party whose will is overborne so that it is not independent and voluntary, just as it will also be granted when such advantage is taken of an innocent party who though not deprived of an independent and voluntary will, is unable to make a worthwhile judgment as to what is in his best interests (at 462)."

In cases of proven unconscionability, the courts will set aside the contract or refuse to make an order for specific performance of it.

Chief Justice Gibbs stated that "The appellant should in my opinion fail only because of its failure to disclose to the respondents matters which it ought to have disclosed" which is that the guarantee was precarious with the state of the bank account of the son at the time he arranged for his parents to place their property in guarantee, and the very close working relationship between the bank and the son, and that the parents thought that the limit of their liability was only $50,000, not the full value of their investment property (being of the order of $200,000).

He said, "In the present case ... it was ... evident to the bank that Mr. and Mrs. Amadio stood in need of advice as to the nature and effect of the transaction into which they were entering.