The era of social distancing brought on by the recent Covid-19 pandemic has greatly limited in-person retail interaction. Consequently, e-commerce transactions and other online interactions have significantly increased in popularity, making well-drafted website Terms and Conditions more essential than ever for website operators. Website Terms and Conditions, coupled with online Privacy Policies, are the legal documents used to establish the contractual relationship between website operators and their respective end-users and customers.
Given this vital role, it is of paramount importance that website operators ensure that their website Terms and Conditions limit liability to the maximum extent permitted by law and provide other key legal protections.
Why Is It Important to Have A Contract with Website End Users?
Limiting Your Company’s Liability and Safeguarding Assets
Given that Website Terms and Conditions are almost always the only contractual nexus between the end-user and the website owner, the Terms and Conditions must be broad in scope in order to address as many contingencies as possible. Without a comprehensive approach, website operators could be vulnerable to otherwise avoidable pitfalls, setbacks and lawsuits.
Generally, the Terms and Conditions should address some or all of the following (which is by no means a complete or exhaustive list), as each website will have site-specific legal needs/concerns: (1) a description of the functionality of the website and its underlying service/product offerings; (2) any applicable payment terms and, relatedly, methods for canceling accounts/processing refunds; (3) general disclaimers, and website-specific disclaimers, which will vary depending on the nature of the website and the underlying content/offerings; (4) clear delineation regarding the ownership rights in and to the website, its intellectual property components and the underlying content/offerings; (5) limitations of liability; (6) Digital Millennium Copyright Act (DMCA) safe harbor language; (7) restrictions on end-user conduct by and through the website; and (8) a dispute resolution section, including choice of law, prohibitions on class actions and arbitration provisions.
The Website Terms and Conditions Should Be Tailored to Fit the Particular Online Business
The specific provisions contained in the Terms and Conditions should be customized in each instance to property account for the type of content/offerings featured on the applicable website, and the underlying relationship between the end-user and the subject website operator. For example, some Terms and Conditions will contain terms governing end-user content submissions, while others will not need such provisions. In addition, in the booming e-commerce sector, the Terms and Conditions should address various payment-related provisions, including refund policies, account cancellation procedures and any form of recurring billing.
Website Terms and Conditions Are Too Important to Neglect
As discussed above, Website Terms and Conditions are often the best means for a website operator to achieve objectives that are necessary for the online business’s continued viability and longevity. These include ensuring protection of intellectual property, disclaiming warranties that might otherwise apply, and limiting the scope of liability that the website operator would otherwise be exposed to. Given the breadth in functions that website Terms and Conditions are intended to serve, it is highly recommended that website operators retain knowledgeable counsel familiar with the many unique legal concerns involved in the online space.
If you are interested in learning more about this topic or require the preparation of Terms and Conditions for your online operations, please e-mail us at info@kleinmoynihan.com, or call us at (212) 246-0900.
The material contained herein is provided for informational purposes only and is not legal advice, nor is it a substitute for obtaining legal advice from an attorney. Each situation is unique, and you should not act or rely on any information contained herein without seeking the advice of an experienced attorney.
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