Why You Need Terms & Conditions for Your Website, and What to Include

So you’ve started your business, and you’ve just launched your website - are there any legal implications you need to think about? There are always legal implications.

One way to set the “rules” between you, as the website operator, and the people visiting or using your website is to draft a set of Terms & Conditions (also broken down and referred to as “Terms of Use” and a “Privacy Policy”).

What Can I Use Terms & Conditions For?

In short, laying out your Terms & Conditions allows you to limit your liability both from users of your website and from uses people make of your website, to protect the intellectual property rights in any content on your website, and to clearly lay out how you will handle users’ data and protect their privacy.

The types of clauses you’ll want to include in your website’s Terms and Conditions depend on the nature of your business. For example, if visitors can make purchases through your website, you can use your terms and conditions to lay out the general provisions you would find in a sales contract. Because your website users could be visiting your site from any country, a choice of law provision and a venue provision are usually a good idea.

In general, you can use your Terms & Conditions to limit your liability in the event someone files a claim against you based on their experience using your website. Suppose that someone relied on information they found on your website, which later turned out to be incorrect.

You can set out what constitutes appropriate use of your website. If, for example, your website hosts user-generated content, you can disclaim liability from the user-generated content.

You can also use your Terms & Conditions to protect your intellectual property. You’ve probably seen a lot of copyright tags at the bottom of websites, but stipulating how information from your website may be used can help you in the event someone infringes your intellectual property.

Lastly, if you are collecting any personal information on your website, you will want to lay out a privacy policy. What sort of information are you collecting? How will you protect your users’ information? In Canada, the Personal Information Protection and Electronic Documents Act sets out certain obligations for businesses which collect personal information. The Office of the Privacy Commissioner also has a number of helpful guidelines for businesses, including tips for website Privacy Policies.

Enforceability

All of the protections you are afforded as a website owner depend on your Terms and Conditions being enforceable. Courts in Canada and the United States have categorized website terms and conditions based on notice and acceptance into “browsewrap” and “clickwrap” agreements.

A clickwrap agreement requires the website user to click a box on their computer screen indicating that they agree to the terms and conditions before being permitted to use the website. Clickwrap agreements are typically found enforceable.

By contrast, browsewrap agreements contain an assertion that by simply using the website the user has agreed to the Terms and Conditions. These agreements are highly scrutinized by the courts because there are concerns that the website user may not have been adequately notified of the terms and may not have indicated that they agree to the terms. In Century 21 Canada Ltd. Partnership v. Rogers Communications Inc. the BC Supreme Court stated, “The act of browsing past the initial page of the website or searching the site is conduct indicating agreement with the Terms of Use if those terms are provided with sufficient notice, are available for review prior to acceptance, and clearly state that proceeding further is acceptance of the terms.”1

Additional Considerations

The types of terms you’ll want to include in your terms and conditions depend on the substance and function of your website.

• Ecommerce: If users of your website are buying products from you, you’ll want terms that govern the conditions of the sale, and you will certainly want to consider your liability. If you’re shipping goods internationally, you may also want to consider whether the Contract for the International Sale of Goods will apply to your sales.
• User-Generated Content: A major consideration if you allow website users to post content is to ensure that you’re not liable for the content they post (if, for example, it’s infringing someone’s intellectual property).
• But It’s Just a Website! Even if your page simply provides information, you’ll want terms to disclaim your liability in the event that you’ve accidentally posted misinformation (even stating that the information may not be updated in a timely manner) and someone relies on that information. If your website is for your business, you’ll also want to think about whether you are fairly representing your business to the public.