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Changing the Terms of an Online ContractIf you have an online business, you may have an ongoing contract with many of your customers. This represents a fairly common situation, but what if you want to change the terms of the contract? Changing Online Contract Ever since e-commerce first began, the issues surrounding online contracts have always been a bit blurry. While it is readily acceptable that someone can click a box to agree to an online contract, the rest of the features of the contract are not particularly clear in relation to their practical use. In the non-web world, the nature of changing a contract is fairly simple. Most contracts contain clauses that state the contract cannot be changed without the written consent of both parties. This works well in a one on one contractual situation, but not when a company is dealing with thousands or millions of customers. In such a situation, the company will write the contract in such a way as to allow it to unilaterally make changes to the agreement. This is what occurs when you receive notices in the mail on changes [which you probably do not read] or increases in your rates [which you probably do]. While the above scenario is well-established offline, it is not online. Courts have wrestled with the issue of how far is too far when it comes to forcing customers to agree with online terms and conditions. After all, the court is fully aware the customers probably are not reading them. Well, one court recently marked out a line in the sand. A Federal Court in the Ninth District has ruled that online companies cannot change and post modifications unilaterally to online contract agreements without first giving notice to customers that have agreed to said contract. The court held that parties to an online contract have no duty to check the terms of the contract from time to time to determine if changes to the agreement have been made. This decision represents a rather interesting development in online agreements. Read strictly, it seems to suggest that an online company must o the agrnsent from every single customer before an online contract can be changed. Such a result would be absurd. A better, practical reading is online companies must send out email notices of any proposed changes. Ah, but what if the online company doesn’t have the email address of the customers? A very careful approach must be then taken. Contact me to learn more. |
