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2 Click wrap contracts------definite receipt rule.
A click wrap contract is like a contract formed by means of telephone since the web server and the customer are in the real-time communications. Any side goes off line and then the other side will be aware of that situation. It’s different from email contracts in this regard. Either side can clearly know the response from the opposite side. The application of the receipt rule looks more reasonable than that of the postal rule.
(a) Is click-wrap an offer or acceptance?
Normally the web page which gives detailed terms and conditions of a contract is an invitation to treat. A click is like an offer which is supposed to be processed by the automated program. When a particular customer clicks the button on the webpage, he is not sure his offer will be accepted. It could be refused due to spelling mistakes, jurisdictions and so on.
On the basis of the conclusion that a click is an offer, the confirmation from the business is regarded as the acceptance. According to the receipt rule, the acceptance is not effective until it communicates to the offeror. Therefore it is subject to the client’s jurisdiction. If there are some disputes arising between the businesses and its clients, it is likely that the business has to appear in the foreign courts. Again this kind of situation won’t be desirable for most businesses.
However, the principle mentioned above, like the post rule, is a default rule. Businesses can change the adverse situation by incorporating some terms to a standard contract. Basically there are two ways.
One is to state in the terms and conditions that the click will be treated as an acceptance therefore the contract will be formed and legally binding at the moment when the business receives the message of acceptance. The benefit is the business can make the contract in its own jurisdiction as a result of the receipt rule. However, under this circumstance, the business who is an offeror can not control the process of creation of contracts. It is likely that in a very short period there are many clients (offerees) accepting the offer and that the business is not capable of supplying sufficient goods. Thus they will face potential disputes on breach of contract.
The other way is to respect the nature that the click is an offer. A business may add in the agreement that the acceptance is effective once sent and therefore the contract is formed and legally binding. In this way businesses can put contracts in their own jurisdictions while they do not risk the breach of contract.
One thing should be pointed out that in many countries the interests of consumers are well protected and it is likely to regulate that any lawsuit should be subject to the consumer’s jurisdiction. Nevertheless, there is nothing to lose for businesses to incorporate some self-interested terms and conditions in the contracts.
III HOW ARE ELECTRONIC CONTRACTS EVIDENCED-------ELECTRONIC SIGNATURES.
A Why Are Electronic Signatures Needed?
One of the challenges to electronic contracts is how to guarantee the original contract to be referred, especially when both sides to the dispute have different opinions on whether there was a contract between them or whether the contents of the contract has been altered by the other party. The major difference between the electronic contracts and the paper-based contracts is highlighted here as a matter of law. Most companies hesitate to conduct business on line just because they are worried about whether electronic contracts can be evidenced when their trading partners deny what they agreed to before.
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