[X4U] Click-through 'contracts'

[Randy B.Singer]

Ted Burton said:

>In California an attorney once bought an insurance policy against 
>some risk, I forget whether it was malpractice or fire insurance, or 
>just what -- I think it was homeowners. He did not read the policy. 
>When a loss came along from earthquake, the insurance company denied 
>coverage saying their policy did not cover that. He sued. He argued I 
>bought home insurance in California, California has earthquakes, I 
>took it for granted home insurance in California would cover 
>earthquake -- and he won.

I'd love to read that case.  I suspect that he won based, not on what he 
expected to be in the contract, but rather based on what his agent led 
him to believe was in the contract.  The writing isn't necessarily the 
entire contract unless you agree in the making of the contract that it is 
an "integrated" contract. (And "integrated" contract is a legal term of 
art for a contract that has no provisions other than those embodied in 
the writing.) If you enter into a contract, and you are told that the 
contract has certain provisions at the time of entering into it, no 
matter what the writing says (assuming there is no integration clause in 
the contract) the contract contains all of the provisions that you were 
led to believe it contains.

On the other hand, if you have a contract in writing, and you agree to 
the contract (e.g. by signing it), and you don't read the contract, you 
are still held to have agreed to everything in the writing.

Folks may have noticed that many modern written contracts (e.g. mortgage 
contracts) now have provisions that they ask you to look at and initial.  
That's so that you can't say that you were led to believe something other 
than the clear terms of the agreement in writing by something that was 
said by the agent.

>So may be you're correct that if there's something in that 
>click-through that is contrary to what one might reasonably expect, 
>and you were powerless to bargain, that you're not stuck.
>
>"Reasonable" is one of those questions of mixed fact and law.

For a while some courts were holding that since the buyer purchased the 
software before reading the agreement (which is inside the box, either 
printed or it appears when you install the software) that the agreement 
isn't binding because traditionally all of the terms of a contract had to 
be agreed to at the time that the offer and acceptance (i.e. you paid) of 
the contract occured.

I read an article about this not too long ago.  Most, but not all, recent 
cases having to do with software purchases across the country have held 
that you have agreed to the terms of the included agreement if you don't 
return the software after having been presented with the agreement.  
Apparently courts decided that it was too difficult for software 
developers to present the entire agreement to purchasers prior to the 
sale and that it was too severe to decide that none of the terms of the 
agreement applied if it wasn't presented at the time of purchase. 

To my knowledge the "powerless to bargain" concept has never applied to 
software sales. In fact, it is a very rare contract concept. 
Traditionally that concept only comes up in contracts for the 
"necessities of life" in areas where the party to be charged literally 
has no other sources for the goods that they need. Software certainly 
doesn't fit in that category.

Also to my knowledge, there is no "reasonable to expect" test with regard 
to common law contracts.  Parties to a contract under the common law can 
put just about anything that they want to in a contract, and there is no 
requirement that the terms be what one would "expect" at all.  The UCC is 
a different matter, but a contract to sell software to a consumer doesn't 
come under the UCC.  The UCC applies only to contracts between merchants.



Randy B. Singer
Co-Author of: The Macintosh Bible (4th, 5th and 6th editions)

MACINTOSH OS X ROUTINE MAINTENANCE
http://www.macattorney.com/ts.html