Article 5: Creating Enforceable Contracts
Online businesses spend a lot of time and money preparing terms and conditions for their websites. These terms explain the rights and obligations to customers, and are supposed to protect the businesses. Yet, we see disputes time and time again over whether or not the online terms and conditions can be enforced against a user.
This isn’t rocket science. If followed, basic contract law principles should maximize the likelihood that your terms can be enforced. These principles are not always followed, however. The result has been scores of lawsuits, many involving large companies with extensive legal resources, whose users successfully have challenged the enforceability of the online terms and conditions. Given that each side in a lawsuit can easily spend tens or hundreds of thousands of dollars, it makes sense to take steps to avoid this risk.
The best way to create an enforceable agreement is with what is commonly called a “click through” or “check the box” agreement. If your website is an e-commerce site, you have a couple of options:
Even if your website is not an e-commerce site, it is relatively easy to form a “click through” agreement if you have an account registration process. Directly before the point where the user completes the registration, add a conspicuous sentence like “By creating an account, you agree to our user agreement” with a hyperlink to the user agreement page or document.
If you have questions whether your website terms and conditions are enforceable, we would be happy to discuss your requirements and assist you. Partridge Snow & Hahn Partner John Ottaviani has over 25 years of experience bringing businesses online and can provide the guidance needed to make the transition as painless as possible. He can be reached at email@example.com or 401-861-8253.
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