In the fourth episode of season seven of The Simpsons, Bart sells his soul to Milhouse for the princely sum of $5. In a somewhat one sided deal, Bart discovers that he has perhaps undersold himself, and is embarks to retrieve his soul, complicated by the fact that Milhouse subsequently trades Bart’s soul for a collection of Alf Pogs.

Bart Simpson would not be alone in trading his soul for something reasonably trivial in comparison.

According to Fox News, up to seven and a half thousand people have, through a standard online contract, sold their immortal souls to British game developer, GameStation.

As part of an April Fools’ Day gag, a clause was inserted into the firm’s standard click-wrap agreement that must be agreed to when purchasing games online, which read:

“By placing an order via this Web site on the first day of the fourth month of the year 2010 Anno Domini, you agree to grant Us a non transferable option to claim, for now and for ever more, your immortal soul. Should We wish to exercise this option, you agree to surrender your immortal soul, and any claim you may have on it, within 5 (five) working days of receiving written notification from gamesation.co.uk or one of its duly authorised minions.”

As if surrendering all claim to your immortal soul was not enough, there was still more:

“we reserve the right to serve such notice in 6 (six) foot high letters of fire, however we can accept no liability for any loss or damage caused by such an act. If you a) do not believe you have an immortal soul, b) have already given it to another party, or c) do not wish to grant Us such a license, please click the link below to nullify this sub-clause and proceed with your transaction.”

According to GameStation, approximately 12% of customers opted out of the clause to surrender their souls. The point the firm was trying to make, and did so quite successfully, is that virtually nobody reads the terms and conditions of an online contract. Gracefully, the firm has stated that they do not intend to enforce their contractual rights.

The incident, while quite humorous, does raise an interesting question as to the efficacy of online contracting, and in particular, the issue of unfair contractual terms. Traditionally, contract law took the view that a contract was an agreement made by two parties negotiating at arm’s length, and saw no reason to acknowledge a power imbalance between the two parties.

This is set to change, however, with amendments to Australia’s Trade Practices Act. The Trade Practices Amendment (Australian Consumer Law) Bill (No. I) 2010, which seeks to outlaw the use of unfair terms in standard form consumer contracts. Under the amendment, a term in a consumer contract is considered to be unfair if:

1)      it would cause significant imbalance in the parties’ rights and obligations arising under the contract; and

2)      it is not reasonably necessary to protect the legitimate interests of the party who would be advantaged by the term; and

3)      it would cause detriment, (whether financial or otherwise) to a party if it were to be applied or relied on.

The amendment gives several examples as to what may constitute an unfair contract, including, but not limited to contracts that allow for unilateral variation, contracts that explicitly limit the contractual rights of only one party, contracts that impose penalties for breach on only one party, or contracts that give the power to assign the contract by one party without the other party’s consent, where such assignment would result in detriment to the unconsulted party.

The effect of this amendment is significant – it provides substantial new rights to consumers dealing with big businesses, where they are given the option of agreeing to a standard form contract or not doing business. The onus falls on the business to show that the contract is not a standard form contract, and that the term is not unfair.

With the changes to the Australian Consumer Protection law, it would be well advised for businesses trading online, and using standard form contracts, to review them to make sure they do not fall under the unfair contract provisions.