–Background–
“Consumers are increasingly purchasing products and services over the Internet. As those Internet transactions have become more prevalent, so too have legal disputes proliferated over the contractual rights created in cyberspace between buyers and sellers.” Hoffman v. Supplements Togo Mgmt., LLC, 419 N.J. Super. 596 (App. Div. 2011)
An online agreement must be “fair and forthright” in order to be enforceable. Although Courts have not specifically defined “fair and forthright,” a review of decisions on this issue illustrate what courts will look at when deciding whether an online agreement is “fair and forthright.” For example:
- Whether or not the online contract is visible without the customer having to scroll down the page (i.e. “submerging” of the terms). Online contracts that have terms that are submerged are less likely to be found to meet the “fair and forthright” standard.
- Whether or not there is a button on the screen requiring customers take an affirmative step to show their assent to the agreement. The existence of such a button makes it more likely that the “fair and forthright” standard will be met.
- Whether customers are required to scroll through the entire terms and conditions before being allowed to click on an agreement button. Requiring customers to scroll through the entire terms and conditions makes it more likely that the “fair and forthright” standard will be met.
—What Does This Mean to You? —
Companies that sell products directly to consumers over the Internet should review and, where necessary, revise their website layouts, to ensure that they conform to the “fair and forthright” standard. The following steps can assist in that process:
- Ensure that the contract provisions are not “submerged” (i.e. the online contract is visible without the customer having to scroll down the page).
- If scrolling is necessary to see all of the terms and conditions, have customers take an affirmative step to show their assent to the agreement, such as clicking a button stating, “Yes, I agree to the above terms and conditions” (“agreement button”).
- Only allow customers to make a purchase after they have clicked an agreement button, whether scrolling is necessary or not.
- Require users to scroll down through the entire terms and conditions before being allowed to click on an agreement button.
- Have users who click on anything other than the agreement button directed back to the terms and conditions before being allowed to “check out.”
- Provide a link to a printer-friendly version of the contract.
—For More Information—
Prepared by Epstein Ostrove, LLC. For additional information on this topic you can contact
Elliot D. Ostrove, Esq. at 732-828-8600.
If you need additional information, please contact Chrissy Buteas at cbuteas@njbia.org or 609-858-9510.
Updated: November 1, 2016
This information should not be construed as constituting specific legal advice. It is intended to provide general information about this subject and general compliance strategies. For specific legal advice, NJBIA strongly recommends members consult with their attorney.
