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I’ve written on occasion about the effectiveness of electronic communications to create binding contracts. For example, in Contracts Quiz: Is This Email Settlement Binding? I discuss a recent case in which a court found that an exchange of emails created a binding settlement agreement, and “NO LIMIT” + “Awesome!” = Contract Modification considers a pithy instant message conversation that modified a written contract. Not all electronic communications that purport to have legal consequences are effective, however.
Venkat Balalsubramani wrote about a recent case where an email exchange was held not to create a contract in Email That Says “Done … thanks!” Doesn’t Transfer Copyrights — MVP Entertainment v. Frost. Here’s an excerpt from Venkat’s description of the facts:
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Here’s a contracts quiz for you. Two parties, Southwest and Winterer, are attempting to work out an agreement about ownership of a couple of adjacent parcels of property and Southwest files a petition for partition. After mediation and other discussions, the attorney for Winterer sends the following email to the mediator:
Here is Winterer’s offer:
- Purchase Southwest’s interest in both parcels for $325,000.00;
- Southwest deliver clear marketable fee simple title to both parcels via warranty deed;
- Closing to take place at a title company of our choice within 30 days of signed Agreement;
- Both parties split the past due tax obligations and Southwest pays for ½ of the 2010 taxes, up to date of closing;
- Both parties dismiss their claims in the Partition suit with prejudice;
- Southwest and Winterer execute a document containing mutual releases, non-disclosures and nondisparagement agreements.
And, of course, both parties split your fee.
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A New Jersey appellate court recently refused to enforce an online forum selection clause that was contained in a browsewrap agreement, but it stopped short of holding that browsewraps are unenforceable as a matter of law. The case is interesting because of the comparisons the court draws with the influential and well-known case of the United States Court of Appeals for the Second Circuit Specht v. Netscape Communications Corp. and the New Jersey case Caspi v. Microsoft Network, L.L.C. (It’s also interesting because the case involves the online purchase of a “performance-enhancing” supplement known as “Erection MD,” but I digress.) [click to continue…]
I’ve written fairly often in these web pages about whether online terms and conditions are enforceable—partly because it’s a developing area of contract law, partly because I’m fascinated by the legal fiction that there’s a “meeting of the minds” between website owner and user, and partly because I’m waiting to see what happens when a website owner crosses the line as illustrated by this South Park clip. The ABA’s Business Law Today magazine recently published an excellent article about whether online terms are enforceable, which focuses on the incorporation by reference doctrine. The article was written by Raymond P. Kolak and Ryan D. Strohmeier and it’s well worth a read.
Kudos to Active.com for putting together an excellent browsewrap checkout screen. I had to navigate through the screen recently in order to sign up for the St. Louis Rock ‘n’ Roll half marathon.
When courts determine whether to enforce online terms and conditions, they tend to focus on whether users had notice of the online terms and whether they assented to them. To my mind, the perfect notice and assent procedure would require the terms to be loaded onto the user’s computer screen for long enough to ensure that the user had sufficient time to read them. [click to continue…]
I’ve been reading and thinking a lot lately about website terms of service. There’s something unsavory to me about having a contract formed between a website owner and its users by posting complicated legalese on the site and pretending the users read them.
It’s the “pretending the users read them” part that bothers me. Everybody knows consumers don’t read these complicated–and oft-changing–legal documents, yet they form the contract between website and consumer. As Coco Soodek, BigLaw partner and author of the book Birth to Buyout, wrote in a recent post on her Profit and Laws blog, “businesses that pose these contracts have to pretend that they don’t know that you know that they know that you aren’t going to read the contract.” [click to continue…]
Cheers to Mike Wokash, aka @MadisonIP, for the link.
South Park has never sustained my interest, but this clip, which I discovered on mashable.com, is downright funny. In the clip the green-capped character (Kyle, according to chacha.com) finds that he agreed to much more than he bargained for when he clicked on the iTunes terms.
Are contracts made via email enforceable? You betcha—although not in all cases.