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Missouri Court of Appeals says link to terms is sufficient for contract

A website could enforce its terms and conditions even when a user neither visited them nor checked a box to indicate her acceptance, a US court has ruled. It was sufficient that a link to the terms was placed next to a 'submit' button, the court said.11 Jan 2010

A woman in Missouri failed in her claim that she could not be bound by a website's terms and conditions because the site had not forced her to look at a page with the conditions listed on it.

Victoria Major used a site called ServiceMagic, which puts people in touch with pre-screened tradesmen. Users of the site enter the details of the work they require on a number of pages, each of which contains a link to the company's terms and conditions. On the final page, the user completes her contact details and hits a 'Submit' button. Next to the button was a blue hyperlink to the website terms and the notice: “By submitting you agree to the Terms of Use.”

Those terms and conditions included a stipulation that any dispute arising from use of the site was to be settled in Denver County, Colorado.

Major did not click on the link and, when dissatisfied with the work that was carried out to her home, sued ServiceMagic as well as the contractors.

ServiceMagic said that the Missouri suit was invalid and that Major would have to take action in Colorado, as stipulated by its terms of use. Major disputed that but the Missouri Court of Appeals has rejected her claims that she could not be bound by terms that she had not read.

"[Major] claims the notice of website terms was inadequate and no 'click' was required to accept them," said Judge Nancy Steffen Rahmeyer.

"The legal effect of online agreements may be 'an emerging area of the law,' but courts still 'apply traditional principles of contract law and focus on whether the plaintiff had reasonable notice of and manifested assent to the online agreement'," she wrote, quoting past rulings,

Major said that a previous ruling involving Netscape, a case referred to as 'Specht', backed her case because a court said that terms could not be enforced that appeared only at the bottom of a page with no indication near the top of the page that a user must scroll down to see those terms.

The Missouri Court rejected that argument, saying that Major had plain sight of a notice telling her where to find the terms and conditions.

"By contrast, ServiceMagic did put 'immediately visible notice of the existence of license terms' – i.e., 'By submitting you agree to the Terms of Use' and a blue hyperlink – right next to the button that [Major] pushed," said the ruling. "A second link to those terms was visible on the same page without scrolling, and similar links were on every other website page."

Major argued that a better method for websites to use was one in which users had to click a button affirming that they had read and agreed to the terms. The Court disagreed.

It said that while it might be desirable that such buttons be used, "there is no fundamental reason 'why the enforceability of the offeror's terms should depend on whether the taker states (or clicks) ‘I agree','" said the judge, again quoting a previous ruling.

"[Major's] contention that the website terms were so inconspicuous that a reasonably prudent internet user could not know or learn of their existence, or assent to them without a 'click', is unconvincing," said the judge.

The case was dismissed from the Missouri Court.

Struan Robertson, a technology lawyer with Pinsent Masons, the law firm behind OUT-LAW.COM, said that in the UK, there are very few cases on the incorporation of website terms and conditions.

"There isn't much guidance from courts in the UK on website contracts, but we generally advise clients to include a check box that forces users to indicate that they accept the terms and conditions," said Robertson. "The terms should be easy to access via a Iink and any key or unexpected points should be summarised in the mandatory screens of the e-commerce process."

"Most website users don't read the small print and courts will understand that, but as an operator you can take steps to maximise the likelihood that users know what they're signing up to," he said. "In contrast, leaving your terms as an optional link without a check box runs a real risk that a court will say they're not incorporated and therefore they're meaningless," he said.

Editor's Note: We thank Mike Masnick's excellent Techdirt blog for bringing this case to our attention.