Terms of Use: What do they actually say?

Do rental cars and Facebook have anything in common?  Well maybe more than you would expect.  Since the advent of the click-wrap, click-through, and click-agree Agreements, I have struggled with how binding they can be.  Can we really expect the parent of a screaming 2 ½ year old to be in a position to “Agree” to the lengthy of Terms of Use they are presented with when trying to access content to appease their screaming child?  Should it be different for the parent and any other person?  This post will look at how Canadian courts have dealt with the issue of reliance on agreements containing onerous provisions and presented with the expectation of accepting them in a short time.

It is a balancing act to create Terms of Use, one has to balance the desire to minimize risk with the need to make the user aware of the Terms.  In Canada, the duty to make a party aware of provisions dates back to 1978 when Mr. Clendenning rented a car from Tilden Rent-A-Car.  As was, and still is common practice, the renter of a vehicle does not read through the whole rental agreement.  In this case, Mr. Clendenning did not read the fine print on the back of a rental agreement and the attendant at the rental agency was aware of this.  When the rental agency tried to enforce a particularly onerous provision of the fine print, the court refused to let them rely on these terms because they were unusual, particularly stringent and onerous, and the agency was or should have been aware of the fact that Mr. Clendenning did not read the terms or was not aware of them/did not intend to be bound by them, the court said:

“In many cases the parties seeking to rely on the terms of the contract know or ought to have known that the signature of a party to the contract does not represent the true intention of the signer, and that the party signing is unaware of the stringent and onerous provisions which the standard form contains.  Under such circumstances, I am of the opinion that the party seeking to rely on such terms should not be able to do so in the absence of first having taken reasonable measures to draw such terms to the attention of the other party…”

Anyone who wants to read a little further can look up Tilden Rent-A-Car Co. v. Clendenning, (1978), 83 D.L.R. (3d) 400.

How does this apply to Terms of Use?  Well, while the general principle still applies: one is bound by Terms of Use when they are made aware of and/or are required to accept/agree to the terms before being able to use or access the product or service, whether this is click-wrap or otherwise.

What if we take the principle applied to Mr. Clendenning and apply it to click-wrap agreements (the ones where you have to click “I Agree”)?  While the circumstance is different from the rental car industry, the practical reality of users’ actions may not be all that different, and it is possible that the operators of the sites/apps/services ought to know that.

In click-wrap agreements, an attendant does not give you the agreement and watch you sign it without reading it through, but, would it be reasonable for the operator of a site/app/service to be aware that some… many… I could even endeavor to say that the majority, of readers do not read through the entire Terms of Use/Service before clicking “I Agree”.  This is particularly relevant if the Terms go on for thousands of words and possibly contain language so complex that even a seasoned lawyer would take hours to work through them.  If this is in fact the reality, would it be wrong then to argue that the operator should not be able to rely on any provisions of the Terms of Use which are particularly onerous or unusual?

It is certainly true that unlike the usual car rental situation in Tilden, a user of an online site/app/service is at liberty to take their time to read the Terms of Use through at their leisure before using the site/app/service.  While this should play into the determination of how much the user should be presumed to be aware of, the Tilden principle still held that a person relying on terms can only rely on terms they know or ought to have known that the signing party was aware of or intended to be bound by.  I think it is fair to ask what the operator of the site/app/service actually OUGHT to be aware of.  Here is where the issue arises as to what the user can reasonably have been expected to have read/understood/intended to be bound by.  In some cases as mentioned at the beginning of this post, a parent may really not be expected to have had the time to read the Terms, while in other instances, i.e. before joining a social network site or opening an email account with a webmail server, a user can be expected to take more time to look over Terms of Use/Service.  It would also be fair to argue that the length and complexity of the Terms presented to the users would also figure into what the users would reasonably understand, read, and intend to agree to.

So, what can a prudent site operator or app publisher do in order to try and protect themselves from this type of application of the Tilden principle?  While there is no clear answer, an operator can take efforts to make the Terms of Use as clear as possible, as easy to read as possible, and only look for rights/indemnities which one would reasonably expect to find in typical Terms of Use/Service for similar apps/sites/services.

Some of the techniques which can be helpful (not necessarily applicable to all circumstances and certainly not a comprehensive list):

  • Use Simple English rather than legal lingo whenever possible;
  • Try and make the Terms as short as possible;
  • In some circumstances outline the General Terms in a summary;
  • Draw particular attention to any unusual or particularly onerous or stringent terms;
  • Offer easy modes of communication for any questions a prospective user may have.

*Now I have to include the disclaimer that you should always consult with an appropriate lawyer in drafting your Terms of Use/Service.

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