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Website terms and conditions are usually not the first thing you look at when browsing a website, realistically most people never look at a website’s terms and conditions unless confronted with a dialogue box asking for their acceptance. However having a page of terms and conditions as well as a privacy policy is vital to the successful operation of your website or online business.
In 2009 the ACCC began a crackdown on the websites of online retailers who “simply ‘cut and paste’ information from other sites on warranties and refunds without checking that the facts are correct”, to quote the ACCC chairman Graeme Samuel. The ACCC successfully pursued the large online retailer DealsDirect over warranty terms on their goods which were in breach of the Trade Practices Act 1974 (Cth). The company was forced to change its website terms and conditions in accordance with a court order.
While issues with the former Trade Practices Act 1974 (Cth), now the Competition and Consumer Act 2010 (Cth), are confined to websites selling goods or services every website will need terms and conditions as other laws will affect them. For example you might like to limit the ways in which users can use your website’s content; this will only be enforceable if your terms and conditions comply with the common and statutory laws of contract, and the Copyright Act 1968 (Cth).
Here are some areas to consider when drafting website terms and conditions:
What does your website offer?
Every website is different and will therefore require a unique set of terms and conditions. Websites can generally be divided into the categories of providing information, product and/or service sales, and those allowing user generated content. It is vital to work out what it is your website is offering and draft your terms and conditions accordingly.
For example a website allowing users to buy products and/or services will require terms about distribution, warranties, a returns policy, and to make sure such terms and conditions do not offend the provisions of the Competition and Consumer Act 2010 (Cth). Websites allowing user generated content will need to have terms explaining who carries legal responsibility for the content, and procedures for dealing with offensive content. Any website will also need to explain the conditions upon which users can use website content and features, and to know what uses of original content are allowed under the Copyright Act 1968 (Cth).
One size does not fit all, and simply copying and pasting the terms and conditions of another website to your own will mean you are left with a policy that does not match your website’s content and functions – a problem that may have legal ramifications like it did for DealsDirect.
Privacy Policy
In simple terms a website’s privacy policy sets out what information the website provider will collect from users, and what they will do with the information. It is an important part of complying with the Privacy Act 1988 (Cth) ‘privacy principles’ (section 14) which applies to those enterprises based in Australia.
It is essential to inform users if you are collecting credit card details when they pay for goods or services on your site, or if you require users to register and they provide personal information for example on social networking sites. Even if your website is simply providing information a privacy policy is necessary as information about the accessing computer is collected by all servers. P
Privacy policies are definitely not one size fits all, think about the privacy policy of Facebook compared with the privacy policy of say ebay, simply copying and pasting from one to the other would be ridiculous and it is the same for any other website.
Enforceability
The most important aspect of website terms and conditions and privacy policies is that they be enforceable. Think of the terms as an online contract which once accepted by a user is binding on both them and you. As was the case for DealsDirect terms which offend the law, in that case the Trade Practices Act, will not be valid or enforceable. This leads to uncertainty for consumers and importantly for retailers who will base their business around the terms and conditions customers have agreed to.
It should be noted that the case of Trumpet Software Pty Ltd v OzEmail Pty Ltd (1996) 34 IPR 481 calls into question the exact nature of the relationship between website users and website providers. In Trumpet the court held that any online agreement which does not see consideration (something valuable) pass between the two parties will not be a contract, simply navigating to a webpage does not establish a contractual or license arrangement. This means that online retailers should not have enforceability issues with their terms and conditions as a submission of payment is an acceptance of your terms for consideration by a customer.
However it seems that ‘click-wrap’ agreements, where a user must click to accept the terms and conditions of a site, would be contractual in Australia provided we follow American decisions on the matter: Specht and Ors. V Netscape Communications and America Online (United States District Court, New York, 3 July 2001). This means for some websites which do not require consideration or express agreement (clicking) by users the question of enforceability remains open. It is therefore better to be safe than sorry and have your terms and conditions drafted by lawyers in order to avoid problems in the future.
Finally it is important to state which country’s laws apply to your website’s terms and conditions as this is where any legal enforcement of a user or provider’s rights will occur.
It is clear that website terms and conditions are not as simple as their humble place, hidden in the footnotes of websites, would suggest. They are extremely important for any website or online business, particularly retailers. It is therefore essential that you get them right, do not copy and paste. Professional drafting may seem like a large outlay of capital, however provided your business model does not dramatically change the terms and conditions prepared by a lawyer will last you the life of your website. Remember one size does not fit all.
Other Website Terms and Conditions articles:
- Watch Out For That Health Centre Terms and Conditions!
- Website Terms And Conditions. Online Liability: Are You At Risk?
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Although we have made every effort to ensure the information has been obtained from reliable sources, Inveiss Legal Pty Ltd is not responsible for any errors or omissions. In no event will Inveiss Legal Pty Ltd, or its directors, agents or employees, be liable for any decision made, or withheld, in reliance of the information contained herein.
