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Terms and conditions are usually the first thing you see and agree to when visiting a website. It’s good business practice to be transparent with your customers – after all, Australia has a lot of strict laws around this like misleading and deceptive conduct under the Australian Consumer Law.
So, a good Terms and Conditions Agreement is a great place to start.
A Terms and Conditions Agreement (T&Cs) is a contract that sets out the rules regarding your obligations to the customer while they use your website and their duty as a customer.
It not only minimises your business’ potential liability in the event of a dispute, but it also lets customers know what they can and can’t do before they proceed to use the website.
Whether you are updating your current T&Cs or thinking of getting one, there are a number of key things to understand:
- The role of T&Cs
- The legal requirements surrounding T&Cs
- How T&Cs should be accepted
- Formatting of T&Cs
- How to ensure your terms are fair under the ‘unfair contract terms’ regime
Keep reading to find out more!
What Are T&Cs?
The T&Cs for a website is an agreement between you and your customers regarding the use of your website. It essentially lays out the conditions upon which users can access and use your website. So, if they don’t agree to these terms, they cannot use your website.
It contains information regarding:
- The customers’ use of the website
- Duties and expectations of customers
- Liability protections for your business
- Important disclaimers
Typically, you will find T&Cs to be the first thing you see when entering the website of an online business. Agreeing to these terms allows you to continue to browse their webpage.
Why Do I Need T&Cs?
In Australia, it is legally required under the Australian Consumer Law (ACL) for all websites selling a good or service to have terms and conditions.
A T&Cs Agreement covers a number of key things between you and your customer before they can begin using your website. For example, these may include the following matters:
- Shipping methods
- Secure payment
- Related risks (e.g. guidelines around online behaviour)
- Liability
- Cookies
- Privacy concerns
As a result, if something goes wrong while someone is browsing your site, well-drafted T&Cs can limit your liability for any losses that come out of this mishap.
Accepting T&Cs Online
When adding T&Cs to your website, it’s important to ensure your customers accept the terms actively. Let’s say your website has a small notification with your terms and conditions printed in small font, making it difficult to read – this will not suffice.
Rather, it’s important to have a box they can tick or a button they can press in order to accept the T&Cs. For example, each time someone visits your site, you may have a banner pop up which requires them to read and accept your T&Cs before they continue browsing your site.
In addition to this, if your T&Cs have a term that isn’t usually included in standard online T&Cs, it’s important to draw your users’ attention to this term so there is a fair opportunity to view and understand what they are agreeing to.
This is particularly important to ensure your T&Cs do not contain unfair contract terms – we’ll cover this in more detail later.
| Example Courtney sells gift hampers online. As all the hampers contain a bottle of wine, she requires her customers to be above the age of 18. To reflect her demand, Courtney has T&Cs in place on her website that requires users to be over the age of 18 before accessing her website. |
Are Website T&Cs Legally Binding?
Yes, a website’s T&Cs are legally binding as long as they are reasonable.
There is no formal signing of a T&Cs document, so it may not feel like you are entering into a legal contract. Despite this, agreeing to T&Cs is the same as signing a contract on paper.
So, it is the duty of both you and your customer to uphold these promises to the best of your ability.
How To Write T&Cs For Your Online Business
A T&Cs document should be catered to a business and their unique demands. However, there are usually terms that are consistent across all T&Cs.
Nonetheless, we always recommend seeking a legal professional to write your T&Cs for you, as it is an important legally binding document that you don’t want to get wrong.
Most website T&Cs will look something like this:
| Example “The conditions of use for the website prohibit utilising this space for any unlawful or unethical conduct. Before proceeding, users must understand that: – Any information that is collected is stored securely in our database for three months, it is then permanently deleted – We only ship and operate in the Oceania regions – All dollar amounts are in AUD – Any returns or refunds must be done within 60 days of receiving the purchase – There is a flat rate of $10 for all shipping” |
What Should I Know About Unfair Contract Terms?
Unfair contract terms essentially favour one party to a contract over another. According to ACL, it is not only unethical but also illegal to have unfair contract terms.
In Australia, unfair contract terms are those that are considered to be:
- Not reasonably necessary
- Of detriment to one party
- Causing a large imbalance between the parties
| Example The T&Cs of Dan’s online clothing website claims there are no returns or refunds for products, under any circumstances. Jen receives a different item to what she ordered and contacts Dan’s business. They reply that nothing can be done and point out she agreed to this when using the website and agreeing to the T&Cs. As the terms don’t seem right, Jen brings the matter in front of a small claims tribunal who side with Jen. They find that the term prohibiting any refunds whatsoever is of detriment to Jen and causes a large imbalance in bargaining power. The contract terms cannot be upheld as they are unfair. |
Therefore, when setting out the T&Cs for your website it’s important to ensure they are within the legal framework. If you are unsure about this, feel free to contact one of our highly experienced lawyers for help.
What Else Do I Need?
T&Cs aren’t the only online legal document you are required to provide to your customers. Cookie Policies and Privacy Policies should also be present on every eCommerce website that collects the information of its users.
A Cookie Policy lets users know how their data is being tracked and the ways that the information is being used. According to Australian privacy laws, consumers have a right to know this information and it is the duty of every online business to be transparent about their privacy collection processes.
Generally, you will need to have a Privacy Policy in place if the Privacy Act 1988 applies to your business. Generally, if your business has an annual turnover that exceeds $3 million (however, there are some exceptions to this threshold, such as businesses who collect health information).
Most businesses will need to comply with this, as the Australian Privacy Principles require all businesses that collect information to have the relevant policies available on their sites. It’s advisable to see a legal professional to gain clarity about your legal obligations under website privacy as this can be a complicated area of law.
Key Takeaways
T&Cs are not only a legal requirement to have, but they are essential in ensuring a good relationship between you and your customers.
To summarise what we’ve discussed:
- T&Cs are a legally required document that allows transparency about using your website to any customers
- It’s important to make sure the agreement is constructed legally and there is active acceptance of it
- Cookies and Privacy Policies should also be included on your website, especially if the Privacy Act applies to you (if you’re not sure, you can chat to a lawyer about this).
At Sprintlaw, we provide a number of different T&Cs. You can check them out here:
- Clothing Store Terms And Conditions
- Alcohol Terms And Conditions
- Healthcare Terms And Conditions
- Bundled Product Terms And Conditions
If you would like a consultation regarding online T&Cs, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.
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