CHAPTER 12: AGREEMENT IN TRADITIONAL AND E-CONTRACTS 17
According to the New York court hearing the case, NA’s restrictive clause misled customers and was thus
deceptive. First, the license agreement stated that it contained all of the terms of the agreement. Therefore,
the rules and regulations listed in the restrictive clause appeared to be independent of the license contract.
This could mislead purchasers of the software because they might believe that the restriction was created by
some other entity, such as the federal government.
For these reasons, the court concluded that the restrictive clause was deceptive and constituted fraud.
The court ordered NA to stop including the clause in its software. The court also ordered NA to reveal “the
number of instances in which software was sold on disks or through the Internet containing the above-
mentioned language in order for the court to determine what, if any, penalties and costs should be ordered.”a
What is the difference, if any, between reading a disputed clause as part of a shrink-wrap
agreement and accessing it through a link as part of a click-on agreement?
3. Browse-Wrap Terms
Browse-wrap terms, which can also occur in an online transaction, do not require a user to assent to
the terms before going ahead with the deal. Offerors of these terms generally assert that they are
binding without the user’s active consent. Critics argue that a user should at least be required to
navigate past the terms before they should be considered binding.
C. FEDERAL LAW ON E-SIGNATURES AND E-DOCUMENTS
In 2000, Congress enacted the Electronic Signatures in Global and National Commerce Act to provide
that no contract, record, or signature may be “denied legal effect” solely because it is in an electronic
1. E-Signature Technologies
An e-signature is “an electronic sound, symbol, or process attached to or logically associated with a
Some documents are excluded: from the E-SIGN Act, most notably documents governed by
Articles 3, 4, and 9 of the UCC.
D. PARTNERING AGREEMENTS
Through a partnering agreement, a seller and a buyer agree in advance on the terms to apply in all
transactions subsequently conducted electronically. These terms may include access and identification
codes. A partnering agreement, like any contract, can prevent later disputes.
III. The Uniform Electronic Transactions Act