Website Policies: One Size Does Not Fit All (Part Three)

It has become standard practice to put a link to the Terms and Conditions below the fold on the website (i.e., at the bottom of the page).  However, following what everyone else does in posting website polices may be risky for your business.  Recently, a New York federal district court found that in certain circumstances where the Terms and Conditions are posted (i.e., how and when they are viewed by the website user) may give rise to an argument with respect to adequate notice of such terms.  In Hines v. Overstock.com, Inc., 2009 U.S. Dist LEXIS 81204 (E.D.N.Y. Sept. 4, 2009), the court found that notwithstanding that the Terms and Conditions included a clause requiring arbitration of dispute, a consumer who incurred a restocking fee for a product purchased on the website Overstock.com could proceed with a purported class action and would not be required to arbitrate the claim.  In a nutshell, the court determined that consumer did not have even constructive notice of, or assent to, the Terms and Conditions containing the arbitration clause even though the policy contained a phrase stating that, "Entering the Site will constitute acceptance of the Terms and Conditions."  The Court reasoned that Overstock could not show that the consumer had notice of the Terms because she could access the site and make a purchase without viewing the Terms and Conditions.  

This is just one court, but it suggests that placement and perhaps actual consent to the Terms and Conditions may be reuqired depending on the nature of the website.