Best Practices for Modifying Website Legal Agreements

Jun 11, 2014 11:35:00 PM

Modifications of website legal agreements present some complications to the maxim that modifying a contract requires the consent of all parties to the contract. It has been generally accepted that a contract is not enforceable when one party unilaterally changes the terms of a contract or agreement, unless the other party consents before doing so. A common practice is to specify in a website legal agreement that the website owner may modify the agreement at any time, and that continued use of the site constitutes a user’s acceptance of any modifications to the agreement.

Courts have not regularly visited this issue, but when they have, it is clear that putting the burden of constantly checking the terms on the website user is not the best course. The Court in the Zappos case stated:

“Here, the Terms of Use gives Zappos the right to change the Terms of Use, including the Arbitration Clause, at any time without notice to the consumer....By the terms of the Terms of Use, Zappos is free at any time to require a consumer to arbitrate and/or litigate anywhere it sees fit, while consumers are required to submit to arbitration in Las Vegas, Nevada. Because the Terms of Use binds consumers to arbitration while leaving Zappos free to litigate or arbitrate wherever it sees fit, there exists no mutuality of obligation. We join those other federal courts that find such arbitration agreements illusory and therefore unenforceable.”

Illusory and therefore unenforceable. That's not good.

However, by providing notice of a modification, and obtaining a clear manifestation of acceptance regarding the modification, courts have held that a modification can be enforceable. In antitrust litigation involving an online travel company, one court upheld modifications to a website legal agreement where “any modifications to the User Agreement would require the user to complete another transaction and again indicate his or her assent by clicking "Accept."

Best practices with regards to any modification of website legal agreements is to always provide notice of modifications to the users and obtain a clear manifestation of acceptance of the modified website legal agreement.

Brian Powers

Written by Brian Powers

PactSafe CEO & Founder