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Colin Levy

Unveiling the Fine Print: Navigating Contracts of Adhesion with Confidence

Are you familiar with those pop-ups that require you to click an “accept” button to dismiss them? They are commonly encountered when setting up a new computer, powering on a phone for the first time, or installing software.

These strategic prompts are actually called contracts of adhesion. Typically, these are contracts drafted by one side with substantial leverage, e.g., a large company or manufacturer, and then the consumer has little choice but to sign or agree to the drafted terms. This means that the party signing the agreement faces a situation where they must agree to certain terms, or they cannot use the software or product. It is a clever strategy that guarantees your conditions are accepted if the consumer or customer wants to use your product or software.

 

Contracts of adhesion typically arise when there is a need for a high level of acceptance for terms that are the same for many users. These include things like apartment leases, mortgages, insurance documents, end-user license agreements, and car leases. Contracts of adhesion are not a new thing, either. They were first introduced, conceptually, back in the early 20th century and since then most courts, at least in the US, have adopted the concept and recognized the validity of such agreements.

 

One of the most common types of contracts of adhesion is clickwrap agreements and there are quite a few pitfalls associated with them. Yet there also are compelling benefits especially their ability to streamline contracting and acceptance while also limiting a company’s legal risk exposure. That benefit in part explains why clickwrap agreements are pervasive, ranging from login to checkout pages, license agreements for software, and website terms and conditions.

 

As for their enforceability, clickwrap agreements are legally valid and acceptable thanks to laws like the Electronic Signatures Act (ESIGN) and The Uniform Electronic Transactions Act (UETA). However, there are certain best practices to ensure their validity and enforceability. These include requiring each user to explicitly consent to any online terms, provide conspicuous notice of such terms, and get consent again whenever any such terms are modified.

 

Management of clickwrap agreements and other contracts of adhesion is easier, simpler, and more secure with Malbek Klix. Klix helps you quickly and accurately create, modify, and track contracts of adhesion and ensure they are legally enforceable. By creating one-sided agreements, you can ensure that your customers have little choice but to sign or agree to your terms. Explore our Klix datasheet for more information on gaining a competitive edge through the art of streamlining contracts of adhesion.