What's the deal with "terms of use" on websites? How important is it? Is it required by law? Do I, as the site owner, have an "interest" in it?
And suppose I have to – is it worth consulting a lawyer on this, or is it perhaps enough to "borrow" from another site's terms (you don't really think that a company like G… or A… or M… cares if I draw inspiration from their terms of use, do you?)? And what if I don't sell anything on my site and it is just a kind of "business card" for my business?
These questions, and quite a few others, come up from time to time in forums and on various occasions. We will try to put some order into the subject and explain the basics and the framework.
Terms of use: why a website needs clear service terms. Original Hebrew article artwork; current US service terms are linked below."Terms of Use" (or "site terms", "terms of engagement", etc.) are in fact a contract – an agreement – between the "website" and the visitors, those who visit the site, and are intended to settle various legal and commercial issues. The scope and complexity of the issues naturally vary and depend on the type of site, the content displayed, its purpose, the services offered and more.
The "terms of use" of a site through which sports equipment can also be purchased, for example, will presumably regulate, among other things, a series of conditions and provisions concerning the sale of the equipment (prices, delivery dates, right of cancellation, warranty, payment terms and so on and so forth).
If, on the other hand, the site serves only as a "business card" for the "physical" store itself, a significant part of the instructions listed in the first case will, of course, not be relevant.
But although there are significant differences in the "legal needs" and the scope of issues requiring regulation between the two websites in our example, the second one too, the image-oriented one, will probably require regulation of various legal matters, for example: disclaimers for promotions published on the site regarding the store, provisions concerning rights in the photographs and information on the site, the accessibility arrangements in the store, and more. In other words, even sites that do not allow direct business activity through them, and even those that are only brand-image sites and blogs, may raise issues requiring legal regulation and the anchoring of appropriate provisions (and even beyond the issues of accessibility and privacy – major topics in their own right).
But the truth is that the question of whether a particular site is or is not required by law to have "terms of use" misses, in our opinion, the main point.
"Terms of Use" are an opportunity, no less than a necessity. Detailed, accessible and clear "terms of use", tailored to the size of the site and its activity, are a first-rate interest of the site owner himself. A fair, well-drafted, forward-looking agreement, formed after thinking through and understanding the site's activity, allows the site owner to shape the "rules of the game", define boundaries and prepare well in advance for the points where disputes may arise regarding the site's activity and related matters. Issues that were left unanchored and unregulated may, in retrospect, receive a completely different interpretation from the one the site owner had in mind.
Suppose, for the sake of example, that a dispute arises concerning the activity of a particular site, and one of the users files a lawsuit against the owner. Where and before whom will the dispute be decided? The owner of a website who lives in Beer Sheva would presumably prefer that if a lawsuit is filed against him in court, it be heard in his area of residence, and certainly not in the Haifa area. And perhaps he would even prefer that disputes, if they arise, be resolved in arbitration proceedings, far from the eyes of competitors and customers, and not before a court.
A much more serious problem, in every respect, that a site owner in Beer Sheva may run into is if one day he receives in the mail a summons to a hearing in the United States, after one of the site's customers, an American, filed a lawsuit against him in one of the courts there.
And what about the content and materials on the site, photographs and articles published by its owner? Does the site owner agree that they may be used, and that they may also be uploaded elsewhere under certain conditions? And suppose that on the same site visitors can upload posts or comment on articles and materials by others; the owner will very much want to protect themselves in advance against cases in which it turns out that those visitors infringe the rights of others.
Incorrect data, errors and mistakes published by the site owner, or by a third party, are also a phenomenon that may occur on various subjects, and may also cause financial or reputational damage to some third party. Websites, unfortunately, are also often used as a platform for carrying out fraud against innocent people, without the site owner's knowledge. This is a phenomenon with significant legal implications as well.
These questions and issues are examples, truly random ones, out of many topics that may arise and that carry significant implications. Good "terms of use" are ones that take such issues and others into account, and were designed following a correct, wise and professional assessment. They do not guarantee certainty, and how they will be interpreted, in retrospect, depends on various factors and circumstances, but they have the power to significantly reduce the uncertainty and the risks the site owner faces and to improve his position.
Good "terms of use", it is worth adding, should be written in accessible and clear language, and be fair and non-prejudicial. If the site owner can also show that they acted fairly and that the circumstances indicate that they were read and understood, the chances are better that the court will see them as an expression of the will of both parties, even though this is a "standard-form contract" (a complex topic in itself, which we will not expand on this time) and one that was defined in advance by the site owner.
The temptation to "lean on" the terms of use of another site, perhaps even one operating in a very close field, may end very badly. Quite a few algorithms are operated by companies that specialize in the field and provide services for detecting intellectual property violations across the web. But even setting that aside, it is very important to make sure that the "terms of use" were truly tailored to the specific characteristics of the site and the business. In the legal field, small details matter a great deal. The immediate "saving" may turn out to be very expensive later on.
And from a consumer standpoint as well, and with this we will conclude, quite a few studies indicate that legal clarity and fairness, avoiding vague and ambiguous wording, contribute to a business's success and to winning consumers' trust, and indeed on many leading sites the legal documents are worded in a clear and easy-to-read way, much more than in the recent past.
Good luck.
This blog is intended for general information only, and as food for thought. It does not cover the requirements, rules and nuances of the topics mentioned in it, does not constitute a legal opinion, and should not be relied upon as such.
