Businesses are increasingly moving their customer agreements online through terms and conditions (otherwise known as a clickwrap agreement). While this can be a quick and efficient way for businesses to convert customers and close sales, it also opens businesses up to the risk that their terms and conditions are unenforceable. However, your terms and conditions will likely be enforceable if you present them to the customer per best practices. This article sets out essential points for you (as a business owner) to consider when sharing terms and conditions online.
Considerations When Drafting Terms and Conditions
Like any legal agreement, your terms and conditions should be clear. Your terms and conditions should be drafted in plain English and should not be overly legal. You can use formatting to ensure your terms and conditions are not difficult to follow, for example:
- use dot points;
- consider your paragraph spacing; and
- ensure the font is not too small.
Where Should I Place My Terms and Conditions?
Some businesses include their terms and conditions in a footer on their website. However, this is likely insufficient to ensure it is enforceable. You cannot guarantee that your customers will see the terms and conditions or even know they exist.
As such, the best practice is to share your terms and conditions with your customers before they ‘check out’ or complete a purchase on your website. If a customer completes a sale without being prompted to read the terms and conditions, you risk being in a position where your terms and conditions do not apply to that sale. Even if your customers are making several orders with you (for example, on your online shop), you should still ensure that they are accepting the terms and conditions before each purchase is complete.
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Time
Your customers should have sufficient time to read and consider your terms and conditions. Avoid placing restrictions on customers to read the terms and conditions within a specific time.
Presenting Terms and Conditions
While you cannot force your customers to read your terms and conditions, you can implement some best practice processes to increase the chances of your terms and conditions being binding and, therefore, enforceable.
Scroll Function
By requiring your customers to scroll through your terms and conditions in full before they can click ‘Accept’ and proceed to the next page, you can ensure that (at the very least) your customers have seen and are aware of your terms and conditions. This also shows that your business has taken steps to present the terms and conditions to your customers.
Positive Consent
To increase the chances of your terms and conditions being binding, you should require your customers to provide ‘positive consent’ when agreeing to your terms and conditions. Positive consent may be in the form of:
- customers ticking a check-box; or
- customers clicking an ‘I accept’ or similar button.
The above options should be presented in addition to wording like “by checking this box/clicking I accept, I agree to the Terms and Conditions”. In this way, you will have an audit trail of the customer’s consent and can rely on this as evidence in the case of any disputes.
Key Takeaways
While you cannot be sure that your customers are reading your online terms and conditions in their entirety, you should implement best practice processes such as:
- including a scroll function;
- presenting your terms and conditions to customers before they check out; and
- requiring positive consent.
These steps can increase the likelihood that your terms and conditions will be enforceable.
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Frequently Asked Questions
In addition to placing your terms and conditions in a footer on your website, you should share your terms and conditions with your customer each time they purchase goods or services on your website and in advance of them making any payment to you.
While you cannot be sure that your customers are reading your terms and conditions, you can implement best practice processes to ensure that your customers know that your terms and conditions exist. For example, consider including a scroll function and requiring positive consent before a customer can check out.
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