Let me ask you a question that’s critical to your success as a small business. Do you know what NOT to do when writing your website terms of business?
We receive several complaints from small e-commerce businesses that their terms and conditions are challenged continually by customers, particularly on lead times, estimates, extensions, and returns.
There is an understandable view that e-commerce legislation is a bureaucratic box checking exercise which gets in the way of maximising profits. They could also be viewed as an opportunity to increase customer confidence in your business. Simply put, a clear well written contractual process with your customers will reduce complaints, and can make your business more profitable. My argument is that the collateral damage you incur from returned goods faulty or otherwise and time spent dealing with complaints about order completion times will exceed the cost of professionally drafted terms of business. Well written terms of business assist in building customer loyalty giving you an increased return on good customer service.
I’ve set out some mistakes that will increase the chances of your terms and conditions being continually challenged and some pointers as to the Do’s of terms of business writing.
Here’s my list of 10 terms and conditions writing Don’ts based on the number crunching of e-commerce terms and conditions I’ve had the opportunity to review:
1. Don’t forget the overall contractual structure of your terms and conditions.
Terms and conditions should be binding contracts between your business and the customer. Consequently, they need to be structured as contracts not running commentary on the challenges of running an e-commerce business. You need to cover the elements of a contract which are invitation to treat, offer, acceptance and consideration.
Here is an example of the wrong way to structure the introduction to your terms and conditions:
“Terms and Conditions
By using this website and placing an order with us you agree to be legally bound by the terms and conditions below.”
There is a lack of sufficient clarity of the contractual process in starting your terms as set out above. Although the wording might sound legal enough you should have an introductory paragraph that outlines the terms and policies that make up the entire agreement with the customer. The introduction is your chance to clearly set out the contractual structure. There should be clear headings and sub-headings which reach out and grab your customer’s attention throughout the contract. Additionally, the acceptance process needs to be clear and unequivocal.
2. Don’t be vague about who you are.
Here is an example of the wrong way to state who you are:
“This website is owned and operated by Winnie Pooh Rabbit Tigger Associates and any order made in any way with Winnie Pooh Rabbit Tigger Associates are deemed to be bound by these terms.”
You have a legal obligation under Fair Trading UK Consumer Laws, and E-commerce Regulations to correctly identify your business, and to provide a trading address.
Being vague gives the impression that your business lacks legitimacy which encourages customers to challenge your terms of business even if they are lawful.
Your headings should reach out and grab your customer’s attention. Keep your headings and sub-headings short. Don’t put quotation marks around the headings since search engines don’t like it.
3. Don’t put down lead times, delivery and cancellation times that are unlawful.
Here is an example of stating unlawful lead, delivery and cancellation times:
“We aim to process and deliver goods within 14 days. Please allow 30 days minimum before chasing your order. You may not cancel your order because it takes longer than 30 days to deliver your order.
If your goods are damaged in transit, then that is not our responsibility. You are responsible for checking the goods when you receive them and you must sign the delivery note indicating the condition of the goods on delivery otherwise you may not return them. You may not return the goods simply because you change your mind. If we do accept return of the goods you must pay a £20 charge for postage.
Please let us know if your order is urgent and we will do our best to help. If we accept that the goods are poor quality, unfit or not as described, we may at our sole discretion refund you the purchase price within our internal timetable for refunds. Our refund form is available on request.”
I have reviewed several e-commerce terms and conditions that have contained the above Don’ts. The problem with the above is that it not only doesn’t comply with Laws and Regulations including the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 which replaced the Distance Selling Regulations 2000, it also breaches many “soft” law practices. It is very unhelpful to the customer even where the term might be lawful.
I would suggest that the terms and conditions set out different policies dealing with each aspect of the sales, delivery and returns process. There are then sub-headings dealing with each element. So, under the sales process there might be a heading such as Delivery of Goods this will then be divided into sub-headings such as Goods That Arrive Damaged, Goods That Have Not Arrived, Samples, and so on.
4. Don’t neglect flow.
Before you even start writing, you should have outlined the main clauses and sub clauses so that you don’t veer off the track. After you’ve written a paragraph, try assessing it considering the overall contracts. The main issue is to avoid a lack of clarity and missing information. The second thing is that the contractual process should be properly set out. It should read like a contract not a series of clauses clubbed together over time as a new issue arises.
This simple tip alone will help your terms and conditions to flow better.
5. Don’t steal content from other websites.
Don’t rewrite another business website terms in your own words either. You may get by with this unethical practice at first, but in the long run you’ll be discovered especially if you copy a competitor. Your competitors probably often monitor your website and if they discover you’ve been copying the text on their website you could be sued for copyright infringement. It’s fine to get ideas from other sources just don’t plagiarise.
6. Don’t try to entertain your customers.
For example, don’t try to sell your products in the body of your terms and conditions. Humour is okay, but don’t overdo it. Remember, all your customers are interested in are their rights, giveaways they receive, and the cost of your goods.
7. Don’t include pointless clauses in your terms and conditions.
Here is an example of an unnecessary clause:
“CERTAIN LAWS DO NOT ALLOW LIMITATIONS ON IMPLIED WARRANTIES OR THE EXCLUSION OR LIMITATION OF CERTAIN DAMAGES. IF THESE LAWS APPLY TO YOU, SOME OR ALL THE ABOVE DISCLAIMERS, EXCLUSIONS, OR LIMITATIONS MAY NOT APPLY TO YOU, AND YOU MIGHT HAVE ADDITIONAL RIGHTS, SITE POLICIES, MODIFICATION, AND SEVERABILITY.”
Apart from being grammatically incorrect, this clause does not make legal sense. More importantly, I’m sure it would never be relied upon by either of the parties in an e-commerce transaction gone wrong, yet I have found it or different variations of it in the terms and conditions of several websites.
8. Don’t leave different policies disconnected from each other.
Here is an example of a disconnected policy wording:
10. Don’t let errors and detractors remain.
Check your terms and conditions carefully for spelling and grammar errors before posting it.
Ask a knowledgeable colleague to proofread your work for errors or hire a proof-reader. Don’t ditch your solicitor as soon as the terms and conditions have been written (if you decide to use a solicitor and not a DIY job or a template contract). In no time, what you’ve written will be out of date with the constantly changing e-commerce laws. If you keep the same solicitor, then you will probably get a much cheaper rate when you return for an update.
Paying attention to this 10 don’ts will help you avoid some of the biggest blunders in writing website terms and conditions.
There is no universal template website terms and conditions that can solve every customer challenge your business faces. Believe me you will never please everybody. However, by following the above rules of Do’s you should be able to avoid the standard mistakes, no matter what the website e-commerce business.
To book a face to face consultation for commercial legal advice relating to selling online you should contact a specialist website terms lawyer (charge rates may apply and may vary).