Online Contracts
Internet businesses & trading laws
When you trade online you are as equally bound by the law as you would be if you traded in any other way. When trading online it is important that you are aware of contract law in order to avoid making costly mistakes. One of the main problems with contracts online is that most people are unaware of when exactly they are entering into a contract.
A contract online is usually made when a consumer pays for something and this payment is accepted by the retailer. The contract will only be made once the consumer has agreed to pay the amount that is being asked. In the real world, this can be more complex as people may agree to pay for something providing that something else is included in the sale; however, online, only straightforward transactions can be protected by contracts. On top of this, you must ensure that, if you think you will want to make any amendments to a contract you have made at any point, you include a clause for this in the original contract before the transaction has been initiated. This is because you will be unable to change the contract without the permission of the other party, which, if the transaction has been done online, may be very difficult.
Recently, Argos fell afoul of a common problem which online retailers often face. In their TV section, they listed a TV that was meant to cost £399 at a price of £3.99. As they then accepted the buyer’s credit card details and validated the sale, they were liable to sell the TVs at the price they had listed. If they had not sent a confirmation to their customers, they would have been able to back out of the sale on the provision that they would not be accepting the offer of £3.99 for the TVs. If you simply have a price on your website, this is legally considered merely an "offer to buy"; it is only when both parties agree to the sale that a contract is made. To avoid such pitfalls, you should ensure that you thoroughly check prices before you upload them to your website.
You should also make sure that you have a good set of terms and conditions set up online. While the internet is quite an informal place and many people simply don’t read the terms and conditions, it is imperative that you make sure that you have some put together. These should cover as many eventualities as they can and be specific to your business and the products or services that you are offering.
Once you have your terms and conditions in place you need to make sure that they stick. To do this, you need to make sure that they are in the contract before the transaction is completed. The most common way to ensure that your customers read the terms and conditions is to include a page displaying them, which they must confirm that they have read, before they are able to continue.
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