Online Contracts: A Helpful Guide Before Signing

What is an online contract?

An online contract is a legal agreement that is created and executed electronically. It can be used for a variety of transactions, including the purchase of goods or services, the lease of property, or the establishment of a business relationship. This can include, but is not limited to, emails, text messages, and chat applications.

Online contracts are becoming increasingly popular due to their convenience and flexibility. They can be accessed from anywhere with an internet connection, and they can be signed electronically, which makes them faster and easier to execute than traditional paper contracts.

Types of online contracts

There are different types of online contracts. Some common types are:

Clickwrap agreement

A clickwrap agreement is a legally binding contract between two parties that is formed when one party clicks a button or checks a box on a website to signify their acceptance of the terms and conditions of the agreement. The other party is usually the owner of the website.

Clickwrap agreements are commonly used when a person wants to buy something online, sign up for a subscription service, or download software. By clicking the button or checking the box, the person is agreeing to the terms and conditions set forth in the agreement. These terms and conditions can include things like the price of the product or service, the length of the subscription, and the refund policy.

If a person does not agree to the terms and conditions of a clickwrap agreement, they usually cannot proceed with the transaction. This is because clicking the button or checking the box is often considered to be an acceptance of the agreement.

Clickwrap agreements can be enforced in court if there is a dispute between the two parties. This is because they are considered to be legally binding contracts. A party that does not adhere to the terms of a clickwrap agreement may be sued for breach of contract.

Browse wrap agreement

A browse wrap agreement, also known as an "I agree" agreement, is created when a user activates a hyperlink or button to indicate their consent to the terms of service. This type of agreement is generally less formal than a traditional contract, and typically includes fewer protections for the user. Because there is no signature or other form of authentication, a browse wrap agreement can be difficult to enforce in court.

Scroll wrap agreement

A scroll wrap agreement is when the terms and conditions are presented to the user in a scrollable window. The user is required to scroll through the entire agreement before being able to proceed. This type of agreement is often used for lengthy or complex agreements.

Scroll wrap agreements are generally considered to be binding contracts. However, there are some circumstances in which a scroll wrap agreement may not be enforceable. For example, if the terms and conditions are unfair or if the user was not given a reasonable opportunity to read and understand the agreement, a court may find that the agreement is not valid.

Adhesion contract

An adhesion contract is presented on a "take it or leave it" basis. This means that the user does not have an opportunity to negotiate the terms and conditions of the agreement. Adhesion contracts are commonly used for standard forms, such as terms of service agreements and end user license agreements.

Adhesion contracts can be enforceable in court if the terms and conditions are not unfair or unconscionable. However, if a court finds that the terms and conditions of an adhesion contract are unfair or one-sided, they may refuse to enforce the agreement.

Making an online contract

Electronic contracts are not as simple as many people think. In fact, there are different types of online contracts, and each has its own set of rules and regulations. These are the basic steps to be followed when creating an online contract:

1. Determine the type of contract you need.
2. Understand the terms and conditions of the contract.
3. Fill out the necessary information on the contract.
4. Review the contract before you sign it.
5. Sign the contract electronically or print it out and sign it physically.
6. Keep a copy of the signed contract for your records.
   

Online Contract Features

Electronic contracts are popular because of the convenience they offer. They can be completed quickly and easily online, without the need for paperwork with the help of digital signatures. They are also protected by encryption technology, which makes them more secure than traditional contracts.

There are a few key features that you to know to create online contracts stand out from the crowd:

1. Ease of use - Online contracts can be completed quickly and easily, without the need for paperwork or signatures. Consult the Electronic Transactions Act in your jurisdiction for more information.
2. Security - Online business contracts are protected by encryption technology, which makes them more secure than traditional contracts. The Australian Consumer Law is a great guide to follow when making electronic agreements.
3. Convenience - An electronic contract can be completed from anywhere, at any time.
4. Flexibility - Online contracts can be adapted to meet the specific needs of the parties involved.
5. Cost-effective - Online contracts are often cheaper to create and maintain than traditional contracts.
   

E-contract checklist

Use this checklist to make sure that your e-contract is legally binding. You should consult with a lawyer to ensure that your specific contract meets all legal requirements.

1. All Parties Must Be Legally Eligible to Contract: This means that they must be of legal age (18 years old in most jurisdictions) and have the mental capacity to understand the terms of the contract. If any party is not legally eligible to contract, contract law states the agreement will not be valid.
2. There Must Be an Offer and an Acceptance: The contract must contain a clear offer from one party and an acceptance of that offer by the other party. The acceptance must be unequivocal and made in the same form as the offer.
3. The Contract Must Be Certain: The terms of the contract must be clearly specified and agreed upon by both parties. If there is any ambiguity in the contract, it will likely be interpreted against the party that created the ambiguity.
4. The Contract Must Not Breach Any Laws: This means that the contract cannot violate any laws or regulations, including local, state, and federal laws. It must also be in compliance with Australian Consumer Laws.
5. The Contract Must be Signed: In order for a contract to be legally binding, both parties must sign it. If the contract is electronic, then an electronic signature will be acceptable.
6. The Contract Must be Delivered: The contract must be delivered to the other party in order for it to be legally binding. This can be done through physical delivery or electronically.
7. There Must Be Consideration: This is the legal term for something of value that is given in exchange for a promise. The consideration must be something that is legally recognised, such as money, goods, or services.
8. The Contract Must be Enforceable: This means that the parties must have the legal ability to enforce the terms of the contract if it is not honoured. This typically requires that the contract be written in a specific way and that either the parties reside in or the subject matter occurs in a jurisdiction where the contract can be enforced.
   

FAQs

Can contracts be signed online?

Yes, contracts can be signed online as long as both parties have agreed to the terms. In some cases, an electronic signature may be required in order to validate the contract. It's important to make sure that you have a secure connection when signing any type of contract online.

What are the features of an E-contract?

An E-contract is an online agreement between two or more parties that is formed electronically. It can be in the form of a document, an email, or even a chat message.

Some features of an E-contract include:

1. The ability to create and sign contracts electronically. This means that you don't need to print out and sign a contract, then scan and email it back. You can simply create the contract online and send it to the other party for signing.
2. The ability to store contracts electronically. This means that you don't need to keep a physical copy of the contract in a file cabinet. You can store it in the cloud, or even on your computer.
3. The ability to send contracts electronically. This means that you don't need to mail a contract to the other party. You can simply email it, or even chat with them online.
4. The ability to access contracts electronically. This means that you don't need to go to a physical location to get a copy of the contract. You can access it online, from anywhere in the world.
5. The ability to keep track of contract changes electronically. This means that you don't need to make a handwritten note of the changes and hope that you will remember them later.

What is a cross offer?

A cross offer is an offer made by one party to the other party that contradicts the first party's original offer. For example, if Party A offers to sell a product to Party B for $10, and Party B counteroffers to buy the same product from Party A for $5, then this would be considered a cross offer. Sometimes, a cross offer can be used as a way to confuse or mislead the other party into thinking that they are getting a better deal than they actually are.

What is a unilateral contract?

A unilateral contract is when only one party makes a promise. This party is known as the offeror, and the other party is the offeree. The offeror makes an offer, which the offeree can either accept or decline. If the offeree accepts, the contract is formed. If the offeror attempts to withdraw the offer, the offeree can hold them to the contract.

Unilateral contracts are often used in advertising, as they allow businesses to make offers that consumers can either accept or decline. For example, a business may offer a free trial of their product in exchange for the consumer's contact information. If the consumer provides their information and does not cancel the trial within the specified time frame, they are deemed to have accepted the offer and a contract is formed.

Are wagering agreements illegal in Australia?

Wagering agreements are not illegal in Australia, but there are a few things to consider before entering into one. First, make sure that all parties to the agreement are over 18 years of age and that everyone understands the terms of the agreement. Second, be aware that wagering agreements are not enforceable in court unless they meet certain requirements, including being in writing and signed by all parties. Finally, make sure that you understand the risks involved in entering into a wagering agreement, as well as the potential rewards.

If you are considering entering into a wagering agreement, it is important to seek professional advice from a law firm to ensure that the agreement is legal and enforceable.

How can contracts be discharged?

There are several ways in which a contract can be discharged. The most common way is by performance. This means that both parties fulfill their obligations as set out in the contract. If one party fails to perform, the other party may be able to sue for breach of contract.

What is a counteroffer?

A counteroffer is a new offer made by one party in response to an offer from the other party. A counteroffer voids the original offer, creating a new negotiation. When making a counteroffer, it is important to consider the other party's initial offer, their goals and objectives, and your own goals and objectives.

What are the legal issues in a cyber contract?

A cyber contract is a legally binding agreement that is made between two or more parties online. The main advantage of a cyber contract is that it can be easily negotiated and agreed upon by the parties involved. However, there are a few legal issues to consider when entering into a cyber contract.

What are voided contracts?

A voided contract is a formal agreement that is no longer in effect.



If a contract is voided, it is as if the contract never existed in the first place. This means that none of the parties to the contract are legally obligated to fulfill their duties under the agreement.