In e-Commerce transactions, providing a hyperlink to terms and conditions is sufficient to meet the requirement that certain provisions of the contract be “in writing” or “evidenced in writing”, according to the Court of Justice of the European Union (CJEU).
The case concerned the validity of a jurisdiction clause in a sale of goods agreement entered into by the buyer clicking a box on the seller’s website to confirm acceptance of the terms of a contract (also known as a “click-wrap” agreement). The law stipulates that for jurisdiction clauses agreed by electronic means to be valid, a “durable record” of the terms of the agreement must be provided. The CJEU found that this requirement was met by making it “possible to print and save the text of those terms and conditions before the conclusion of the contract”.
In click-wrap agreements, the terms and conditions of sale are not always displayed automatically in the process leading up to the conclusion of the transaction. Instead, the buyer may have to click on an additional hyperlink to view them. The disputed jurisdiction clause in this case was only viewable by clicking on the additional hyperlink.
Because the terms and conditions could be saved or printed, the possibility of creating a durable record was sufficient regardless of whether or not the purchaser actually saved or printed the terms and conditions. This conclusion reached by the CJEU is similar to that reached in a recent Irish Supreme Court case (we reported on the High Court decision here).
By contrast, in click-wrap consumer contracts, a jurisdiction clause contained in hyperlinked terms and conditions might not be effective. This is because extra protections are afforded to consumers.
Terms and conditions provided only by hyperlink may also be insufficient for other consumer contracts purposes, such as distance selling information requirements. In the Content Services case (which we reported on here), the CJEU held that mandatory information that was set out in a click-wrap consumer contract had not been provided in a durable medium as the consumer had to click on a hyperlink sent by email in order to view it.
Given the differing approaches to click-wrap contracts evident from these decisions, businesses operating across the European market should tread carefully as many use the click-wrap method to incorporate terms and conditions into e-commerce transactions and other contracts concluded online. Firms that sell to both consumers and businesses using a single click-wrap method and/or a single set of terms and conditions must carefully consider their approach to ensure that they meet their legal obligations.
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Contributed by Leo Moore.
