Food for Thought of the Day
"Living with integrity means:
Not settling for less than what you know you deserve in
your relationships. Asking for what you want and need from
others. Speaking your truth, even though it might create
conflict or tension. Behaving in ways that are in harmony
with your personal values. Making choices based on what
you believe, and not what others believe.“
-Barbara De Angelis
© 2005 West Legal Studies in Business
A Division of Thomson Learning
1
Welcome to
Introduction to Business BUS 002
Agenda
TOPIC: Contracts: E-Contracts
• Check-Ins: Questions, Comments, Reflections, AhHa
Moments
• FYI Article “Like, The Constitution is So Hot”: source WWD
• Return Think & Write 2
• (See me if you have not completed a Think & Write or an
Independent Challenge)
• E-Contracts
– Online Offer (Ex. Yahoo’s On-line, Privacy, Copyright
Agreements)
– Online Acceptance
– UETA; E-Sign Act
• Reflection
• Emancipate
2
© 2005 West Legal Studies in Business
A Division of Thomson Learning
Learning Objectives
• What are some important clauses to include when
making offers to form electronic contracts, or econtracts?
• How do shrink wrap and click-on agreements differ
from other contracts?
• What is an electronic signature? Are electronic
signatures valid?
• What is a partnering agreement? What purpose
does it serve?
• What is the UETA? What are some of the major
provisions of this act?
© 2005 West Legal Studies in Business
A Division of Thomson Learning
3
Terms
• Online Contract
• Online Agreement
• Shrink-Wrap Agreements
• Browse-Wrap Agreements
• UCC – Uniform Commercial Code
– Law governing sales contract
• Click-On Agreements
• E-Signatures
© 2005 West Legal Studies in Business
A Division of Thomson Learning
4
Forming Contracts Online
• Online Offers should include:
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Remedies for Buyer.
Statute of Limitations.
What constitutes Buyer’s acceptance.
Method of Payment (including
shipping/handling).
– Seller’s Refund and Return Policies.
– Disclaimers of Liability (seller not accepting
responsibility for buyer relying on product).
– How Seller will Use Buyer’s Information
(Privacy).
© 2005 West Legal Studies in Business
A Division of Thomson Learning
5
Online Contract Formation
• Dispute Settlement Provisions.
– Choice of Law (arbitration, etc.).
– Choice of Forum (location).
– E-Bay uses online dispute resolution.
• Displaying the Offer (via hyperlink).
• How Offer Will Be Accepted.
– Amazon.com--Checkout.
– “I Accept” Button to Click.
• Review Yahoo!’s online, privacy, copyright
agreements
© 2005 West Legal Studies in Business
A Division of Thomson Learning
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Online Acceptances
• Shrink-Wrap Agreements. (ex. software)
– Contract terms are inside the box.
– Party opening box agrees to terms by keeping
merchandise.
• Click-On/Click-Wrap Agreements occur when
Buyer “checks out” or clicks on “I Accept” button on Seller’s
website or when software is installed.
– i.LAN Systems Inc. v. NetScout Service Level
Corp. (2002).
• Browse-Wrap Agreements occur when an Internet
user at the time of using or downloading a product in which
no agreement is required before use.
– Specht v. Netscape Communications (2002).
© 2005 West Legal Studies in Business
A Division of Thomson Learning
7
E-Signatures
• E-Signature Technologies.
– E-Signature is an electronic signature of a person’s
agreement with the terms of an on-line contract.
– Asymmetric Cryptosystem (creates a digital signature
using a private code).
– Cyber Notary (legally verifies the signature)
• State Law Governing E-Signatures.
– Uniform Electronic Transactions Act (UETA) (1999).
– Most states have joined – 46 so far.
– Not all states have the same laws governing esignatures, California is one of them.
• Federal Law.
– E-SIGN (2000) gives e-signatures and e-documents
legal force globally and nationally.
© 2005 West Legal Studies in Business
A Division of Thomson Learning
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What do you think?
In groups of 3-4, answer the
following questions?
• Read and discuss Case 10.3 In re:
Cafeteria Operators on p. 315
© 2005 West Legal Studies in Business
A Division of Thomson Learning
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Partnering Agreements
• Sellers and Buyers agree to do business
frequently and establishes terms for all online
agreements.
• At your seat, write down some types of
Partnering Agreements
© 2005 West Legal Studies in Business
A Division of Thomson Learning
10
Uniform Electronic Transactions Act
(UETA & E-Sign)
• Purpose is to remove barriers to forming electronic
commerce.
• UETA is model state law – enacted by 46 states and
the District of Columbia – recognizing the validity of
electronic contracts, records, and signatures.
• UETA applies only to e-records (email, faxes, etc.) and
e-signatures relating to a transaction.
• E-SIGN is pre-empted (stopped) if state has passed
UETA.
• State law must conform to minimum E-SIGN
procedures (ex. Must be available to be retained and
reproduced online, banking online, etc).
© 2005 West Legal Studies in Business
A Division of Thomson Learning
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Highlights of UETA
• Parties must agree to Conduct Transactions
Electronically.
– A party can “opt out” of UETA terms.
• Attribution—process to ensure person sending an
electronic record is in fact the real person.
• Electronic Errors (ex. breach in security).
• “E-Mailbox” Rules.
– Dispatched when leaves control of sender.
– Received when enters recipient’s processing
system.
© 2005 West Legal Studies in Business
A Division of Thomson Learning
12
Uniform Computer Information
Transaction Act (UCITA)
• Model state legislation governing contracts for
computer information – that is, electronic
information obtained from or through the use of a
computer, or that is in a form capable of being
processed by a computer.
• Applies to computer information.
• Software is not a “good” but intellectual property.
• Software is licensed, not sold;
• License contract gives Buyer (Licensee) only specific
rights.
• Attribution and Authentication.
• Mass Market Licenses.
© 2005 West Legal Studies in Business
A Division of Thomson Learning
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Website Resources for
Online Contracts
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http://www.lectlaw.com/form.html
http://www.findforms.com
http://www.legalwiz.com/forms.htm
http://www.legaldocs.com
http://www.washlaw.edu/legalforms
http://lawvantage.com/index.shtml
http://lbnlaw.com/freedownload2.htm
http://forms.lp.findlaw.com
© 2005 West Legal Studies in Business
A Division of Thomson Learning
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What do you think?
View the Video
“Offer & Acceptance” Did I just sale my car?
In groups of 3-4, answer the following questions?
#1…
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•
•
Has a contract been formed? Has there been a valid offer
and acceptance?
Has the contract been formed yet?
Oscar and Maria have now begun negotiations on Maria's
truck. What mistakes did Vinny make in the video that
Oscar and Maria should avoid in their negotiations?
#2…Reframe (change)…How could this scenario be
changed to an E-Contract situation?
© 2005 West Legal Studies in Business
A Division of Thomson Learning
15
Reflection
• How might today’s content impact my
practice in business?
• What implications might today’s content
have on the local, state, national, and
global communities?
• What have I learned about law and
business that will influence my practice?
© 2005 West Legal Studies in Business
A Division of Thomson Learning
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