Enforceability of Contract Terms Displayed on Social Media

Enforceability of Contract Terms Displayed on Social Media

Gordon Hughes (Davies Collison Cave Law, Australia)
DOI: 10.4018/978-1-7998-3130-3.ch001

Abstract

It is a prerequisite for the use of virtually any social media that the user enter into a contract with the provider. Typically, the user is required to click “OK” or “I accept” at the foot of a lengthy set of online terms and conditions. Sometimes contracts of this nature are described as “clickwrap” or “browsewrap” agreements. Given that a majority of users will typically not read the terms and conditions or, if they do, will feel they have no option but to accept them, and given further that service providers are aware that this is the case, the question arises as to whether and to what extent such terms and conditions are, or should be, in fact, legally enforceable. This chapter explores relevant Australian and overseas case law and commentary dealing with this modern social media legal phenomenon.
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Introduction

It is a prerequisite for the use of virtually any social media that the user enters into a contract with the provider. Typically, the user is required to click ‘OK’ or ‘I accept’ at the end of a lengthy set of online terms and conditions. Sometimes contracts of this nature are described as ‘clickwrap’ or ‘browsewrap’ agreements.

Given that a majority of users will typically not read the terms and conditions or, if they do, will feel they have no option but to accept them, and given further that service providers are aware that this is the case, the question arises as to whether and to what extent such terms and conditions are, or should be, in fact legally enforceable.

Australian case law is sparse in relation to the enforceability of online agreements, but the underlying principles are well established – essentially, if a customer signifies their acceptance of terms to which they are given adequate prior access, they will be deemed to have read and understood them. But is this nothing more than a legal fiction, in an era when it is accepted that the average user will not have read (or, almost certainly, not understood) the terms?

This scenario has direct privacy consequences. Australian privacy legislation – particularly the Privacy Act 1988 (Cth) (the Privacy Act) - is underpinned by the notion of consent. Express or implied consent generally enables a data recipient to act in a manner which would otherwise be contrary to restrictions imposed by the Australian Privacy Principles. If ‘consent’ forms part of online contractual terms applicable to social media usage, there is a need to query whether meaningful consent has been obtained at all.

This chapter explores relevant Australian and overseas case law and commentary dealing with this modern social media legal phenomenon.

Key Terms in this Chapter

Sign-In Wrap Agreement: A process which requires a user to register for a service, but no link or reference is made to terms and conditions.

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