Things to Remember When Drafting Terms of Service (TOS)

If you’ve ever used a website, bought something online, registered for a website, or used any social media, you’ve been hit with the request to sign, or agree to, the business’ Terms of Service (TOS). These unending pages of legalese may seem like gibberish—but if you’re the business being protected by them, they can be vitally important.

User Agreement

If done properly and executed properly, TOS can be a valid and binding agreement between your business, and the site’s user. TOS are, essentially, binding agreements.

But many businesses make the mistake of just posting TOS. Just having them somewhere on your site isn’t enough; the end user must agree to them, and acknowledge that agreement through some affirmative act like checking a box acknowledging agreement.

Multiple States

TOS must generally follow the laws of contracts in not just your state, but in every state where someone may access or use your site. So, for example, if a state requires a separate acknowledgement for a waiver of a trial, or for a hold harmless, or a class action waiver, you’ll need to have a separate checkbox or other acknowledgement for those things in your TOS.

If state law in any given state says that things need to be bold, or in a different font, or set apart from the other language of the agreement, your TOS will have to do that, if it includes any such terms.

That’s what makes TOS so difficult—you need to make sure that it is effective in every state. If you are in a highly specialized industry, like mortgages or gambling or THC products or many others, every state may require their own disclosures or disclaimer.

Which State’s Laws?

Your TOC must be valid in every state. But in the event of a dispute, you can’t use every state’s laws. Your TOS must choose what state laws apply, and what state you can legally be sued in. This may require a state by state analysis of laws, to see which is more favorable for your particular business or industry.

Not Too One Sided

It may be tempting to draft TOS that say that you are always right and the user is always wrong, and that you have all the rights and by checking this box, the user agrees he or she has none.

But be careful. Because these TOS are non-negotiable, they are adhesion contracts. As such, if they are too one sided, or too punitive, or limit the users rights too much, they could be found to be completely unenforceable.

No Liability for Comments

While there are federal laws that say that a website’s owner or host cannot be liable for defamatory statements or other comments posted by users which may be legally actionable, you’ll still want a waiver, saying that you aren’t responsible or legally liable for what anybody says on your site, if your site does allow user comments or reviews.

Severability

Because TOS can be so lengthy, and because so many laws may apply, you may want to have a severability clause. This means that your TOS is still valid and binding, even if a part of it were to turn out to be unenforceable.

Call our Fort Lauderdale business litigation lawyers at Sweeney Law P.A. at 954-440-3993 for help drafting your TOS, or any other contract or agreement you may need.

Sources:

business.com/articles/legal-challenges-for-ecommerce-businesses/

mailchimp.com/resources/website-terms-of-use/