“By accepting these Terms, you agree to relinquish custody of your first born child to us.”

Perhaps I should make more of an effort to read Terms of Service agreements after all?

The image was hosted on PC Pitstop’s homepage, so they are clearly not concerned with it being publicized. But why would a company add such a term? There are two issues behind the inclusion of ‘Special Consideration’ clause that strike me as odd.

First, the clause itself is not enforceable — it is a classic illusory contract. Although it would pass as a unilateral offer and thus acceptable by anyone who actually read it, the last sentence negates any contract like quality it may have. “This offer can be withdrawn at any time” means that PC Pitstop has not actually committed itself to anything at all, and thus has given nothing up, and thus there is a failure of consideration.

Second, depending on how this clickwrap license is set up, the inclusion of the ‘Special Consideration’ clause could actually undermine PC Pitstop’s legal position. Although clickwrap licenses are far from black letter law, the basic theme behind them is that they are held enforceable where they are designed so as to provide reasonable notice and, generally, are assented to by the user’s affirmative conduct. However, by offering a gift in its Terms of Service (ToS), the company is effectively making a demonstration of how few people ever bother to read the ToS. It would by no means be dispositive proof, but if the ToS ever wound up in court, a user might be able to show how he in particular and users in general were not given an effective opportunity to review the terms, because 99.99% of them never tried to cash in on the offer.

As for clickwrap licenses more generally, I believe they provide a good example of how ill-suited old legal forms are when they are attempted to be grafted on to new technology. It is not a secret that no one reads the ToS forms — heck, I remember from 1L year, our contracts professor admitted that she herself never bothered to read them — and yet courts insist on using centuries old contracts principles to analyze them. As seen by Bragg v. Linden Lab, courts can find a term from a ToS ‘unconscionable’ when they do not want to enforce it. This threatens to result in an extremely inefficient system in which contracts are announced unilaterally by one party, never read by the second, and then treated as a “cafeteria contract” by the judge who picks which clauses she wants to keep and which clauses she wishes to discard. The judiciary of course has a little other option, but it would be nice to see the legislatures jump in and establish contract laws that are better suited for the unique online environment.

Unfortunately, given the nature of the internet, allowing state legislatures to direct the process is not an ideal solution either. Much as I reflexively dislike the idea of the federal government involving itself with contract formation, it may be necessary in order to create a more orderly, contractually agreed upon cyberspace.

-Susan

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One thought on ““By accepting these Terms, you agree to relinquish custody of your first born child to us.”

  1. Maybe I’m being charitable, but perhaps PC Pitstop’s goal is in fact to impeach the validity of “click-wrap” licenses.

    Alternately, maybe it’s to get lots of eyeballs on *their* license so it will be more defensible (“Your honor, we have definitive proof that $BIGNUM people actually did read our license; the defendant’s contention that ‘nobody reads those’ is clearly specious”).

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