How companies should approach a hyperlink in contracts

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A question increasingly asked by business customers of all sizes is: “Did I agree to terms that were only referenced by a hyperlink that I did not bother to click” J surely had to click on something to say I was ok with shopping online !?

The answer is yes, potentially, and if you’re not careful you can easily get stuck with something you haven’t read. Like most legal matters, this will depend a lot on the facts of each case.

Why is this the case

There is nothing new about the fact that you may be bound by terms that you do not read as long as the relying party has taken reasonable steps to bring them to your attention. Ultimately, you ignore any reference to applicable terms at your own risk.

Whether the measures taken are reasonable has always been fertile ground for debate, but the Impala Warehousing and Logistics (Shanghai) Co. Ltd ruling against Wanxiang Resources (Singapore) PTE? may shorten this debate in cases involving websites and a hyperlink to the terms.

One of the many questions raised in the case was whether Impala’s terms had been incorporated into a storage contract. The first page of Impala’s warehouse certificate stated that it was subject to Impala’s terms. A note at the base of the first page of the certificate told the reader to refer to the reverse side of the page for additional terms. On turning the page, the reader learned that Impala’s terms and conditions were on their website and gave the address of the Impala homepage (rather than the actual page on which the terms could be found. ).

In Judge Teare’s opinion, all of this was sufficient to incorporate the Impala terms which formed the basis of the contract in question. He said: At this time when standard terms are frequently found on websites, I consider the reference to the website to be a sufficient incorporation of the warehousing terms that are found on the website.

All very sensible and good news for sellers and suppliers looking for easier ways to integrate their terms. From a buyer’s perspective, the decision is remarkable not only because of this salutary quote, but also because the judge came to his conclusion despite the fact that when one visits the Impala website and finds the Terms page, there are multiple sets on it, so a buyer must choose which one applies to their transaction before they can review it.

This suggests to me that in a B2B context, a simple, live, content hyperlink to a term set in an email or an electronic copy of a document that is not buried somewhere in a small text is very likely to be effective and enforceable whether or not it is clicked.

What does this mean for suppliers and buyers?

For sellers and suppliers:

1) Consider putting your terms on a web page (which may be “hidden” from the browsing public) and including a hyperlink to it on pre-contractual documents and correspondence.

2) Do not hide the hyperlink, it must be visible enough to be effective, especially if your terms contain unusual or onerous provisions.

3) Make sure your terms and conditions are up to date and your staff know both what they mean as well as if / when and how they can be changed. Take advice when in doubt, revising terms should not be a costly or major exercise and can save you costly mistakes.

4) Make use of any IP tracking / logging functionality of your website so that you can prove that someone clicked if necessary.

For buyers:

1) The old adage of? attention buyer is alive and well.

2) Follow all references to terms before placing an order, it’s easier than requesting to ship them if there is a hyperlink!

3) Train staff to review terms and quickly refer to those of concern.

4) Look for “prevail” clauses which state that the seller’s terms will apply no matter what. These are unlikely to be effective, especially if you implement procedures to deal with them.

5) Take advice on response procedures if you do not have one.

Simon Walsh is a senior partner in SA Law’s Commercial Dispute Resolution team advising companies on commercial terms.

Picture: Shutterstock

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