Clickwrap agreements are agreements formed on the Internet. A website provider generally posts terms and conditions and the user clicks an "I Accept" button. The courts have generally held these agreements to be enforceable. Recently, some website providers have been skipping the "I Accept" process for fear that online users will not want to go through this extra step and may instead leave for another website. However the recent Second Circuit case of Schnabel v. Trilegiant Corp., 2012 WL 3871366 (2d Cir. Sept. 7, 2012), has reminded website operators to be exceedingly careful in assuring that an agreement has been formed.
In Schnabel, the contracting process included filling out an enrollment screen. After inserting information into the boxes on the enrollment screen, the purchaser clicked on a "Yes" button agreeing that the vendor could transmit credit card data. The vendor followed up with an email of terms and conditions, which, notably, included an arbitration provision. The court found that the contract was formed at the moment the plaintiffs entered their information into the online enrollment screen, and that the follow-up email was not sufficient to add additional terms such as the arbitration clause. The terms and conditions were not shown on the enrollment screen.
For this reason, an online vendor should employ the following registration process prior to taking any order information.
As an initial matter, evidence of an electronic signature can be as follows:
For an electronic signature to be effective, the sound, symbol or process must show the signer's intent to be bound to the particular terms and conditions associated with that action, and must be attributable to the specific person against whom those terms and conditions are intended to be enforced. As an example, there could be text above an "I agree" selection that clearly indicates that by selecting the "I agree" button, the person agrees to be bound to specified terms and conditions.
A clickthrough agreement with an electronic signature should be mandatory and non-porous and should have the following characteristics:
Best practices in a commercial transaction would include requiring registration which includes the following:
Please note that email communications to the firm through this website do not create an attorney-client relationship between you and the firm. Do not send any privileged or confidential information to the firm through this website. Click "accept" below to confirm that you have read and understand this notice.