Victorian Society for Computers & the Law
Speaker: Dr Gordon Hughes, Partner Davies Collison Cave
There have been countless cases decided in the US regarding the enforceability of online contracts, but very few in Australia. It is therefore instructive to review the reasoning adopted by US courts in dealing with the issue. Contracts of this nature have traditionally been described in the US as “click-wrap” or “browse-wrap” contracts, but a hybrid has now emerged in the form of so called “sign-in wrap” contracts. A click-wrap requires the customer to click “I accept”, and these are generally regarded as enforceable; a browse-wrap involves notification of the terms on a website without a formal acceptance process, and these are generally regarded as unenforceable. A sign-in wrap is akin to a browse-wrap, but usually with a prominent notice the effect that by using the service, the customer will be deemed to have accepted the contract terms. Judge Rakoff in Meyer v Kalanick, heard in the US District Court for the Southern District of New York (a federal court), concluded that the Uber registration process, whereby Uber users were advised that by creating an account they were deemed to have agreed to the terms of service, amounted to an unenforceable sign-in wrap contract. Regardless of the outcome, the case involved a discussion of a range of issues which a court might take into account when considering the enforceability of such contracts.