A terms and conditions agreement, also known as terms of service, is a legal document between a provider of a service and a website or app user. This document clarifies and provides boundaries, warranties, and contract principles that govern the relationship between the user and service provider.
1. Introduction to Business
Every terms and conditions agreement begins with an introduction to the business issuing the document. Then, it establishes a context for the contract principles that will shape your user agreement.
Before people can agree to your terms and conditions, they must know exactly who your business is and how these website terms and conditions apply to your site and their experience.
Although you are not technically required by law to have official terms and conditions agreement, it is a highly common and recommended business practice.
Without terms and conditions, you may have a harder time legally enforcing your rights, such as:
- Terminating abusive users
- Avoiding lawsuits
- Protecting your business’s intellectual property
Here is an article that explores the elements of terms of service more.
2. Business Contract Details
The terms and conditions contract helps you establish legal authority over your business and the platform users engage with.
It does a number of things such as:
- Offering legal protection against litigation (lawsuits)
- Protecting your business’s intellectual property
- Regulating user conduct on the site
For example, a large part of terms and conditions for sites with social features is the ban of any discriminatory, hateful, or abusive language.
In this portion of the document, you will describe the contract principles, such as rules affecting the use of content and user conduct on your site or application.
You must establish that the user must consent to all the terms and conditions in the contract. Accepting the terms and conditions allows them to follow a user agreement whenever they use your platform.
A step-by-step article on how to write a terms and conditions agreement.
3. Effective Date
The effective date is the start date of the terms and conditions agreement, for example, November 2022. Therefore, if you update your terms and conditions, you will need to change the effective date.
If you write your terms and conditions for the first time, you can simply write, “Effective From [Date].”
You can change “effective from” to “last updated” when you update your agreement.
Annual reviews are advisable for all user agreements. Your business’s needs may change, or you may alter your agreements to reflect changes in your audience’s behavior.
Whatever the case, every agreement needs to have an effective date. This makes it easier to legally enforce if there is ever a lawsuit or liability.
Here is an article that explains effective dates in contract law.
4. Governing Law
Governing law establishes what legal body will enforce the contract's warranties, regulations, and terms. Here is an example governing body statement:
“ You agree that all matters relating to your interactions on the site/application will be governed by the laws of the United States and the laws in the state of New York.”
Governing law protects your business by ensuring no one can sue it for breaching laws outside your jurisdiction.
Imagine that you have an international client who raises a legal dispute over a violation. Would the dispute be handled based on the laws in their country or yours?
Governing law ensures that your business is always legally operating within the structure of your country and state’s governing laws.
Here is an article about how governing law works in contracts.
5. Limitation of Liability and Warranty Disclaimers
A disclaimer of warranties and liability limitations is important to protecting your business. You can state that your company will not be held accountable for any personal injury, data theft, loss, or other damages incurred by using your website.
You can also limit your liability for any inaccurate content or information found on your site and absolve your business of any responsibility for others’ content or actions on your platform.
In website terms and conditions, it is most common to include a disclaimer for:
- Computer viruses, including malware and spyware
- Device malfunctions and data losses
- User enjoyment
- Product/service satisfaction guarantees
- Downtime due to maintenance, server crashes, or other errors
You can also use your warranties disclaimer section to set a damages cap. This means that if someone files a lawsuit against your business, there is a limit to how much money they can pursue.
Good warranties are fair to both your business and the customer. Therefore, it is important to protect yourself by limiting liability. Still, you must also offer enough security to build trust with your users.
Here is an article with 10 examples of disclaimers you may draw inspiration from.
6. Rules of Conduct
Terms and conditions also impact terms of service. Together, they form a user agreement that grants a person the privilege to access your website or mobile application.
Rules of conduct set the guidelines for behavior on the website. They allow you to:
- Prohibit discussions about particular topics
- Set age restrictions for users
- Provide an outline of what consequences someone can face if they violate your conditions
Examples of penalties include account suspension or termination.
Here is an article with an example of a terms and conditions agreement with clear rules of conduct.
7. Intellectual Property Rights
You can protect your intellectual property through a terms and conditions agreement. Your intellectual property is anything intangible that you own. For example:
- Your business’s name
- Your business’s logo
- Your domain address
Your user terms of service can directly prohibit the unauthorized use, distribution, sale, or sharing of any intellectual property.
Here is an article that provides more information on what counts as intellectual property.
8. User Restrictions
You can include rules for behaviors users cannot do on your website/app. This can include sharing illegal, sexually explicit, stolen, or copyrighted material.
Restrictions are in place to protect the business as well as other users. They prohibit hateful, abusive, or harmful behaviors and protect others’ data and privacy.
You should also note what consequences someone can experience for violating restrictions.
Here is an article you can refer to and see how user restrictions are covered.
9. Right to Termination
The business can reserve its right to delete a user’s account through contract termination agreement.
Breaches of contract can result in immediate termination without warning if someone violates the terms of service in their user agreement.
You can also reinforce the users’ right to terminate service and delete their account with your business anytime.
Ensure you also cover privacy policies and data storage after account termination. For example, suppose a user deletes their account or your company deletes theirs. What happens to their name/username, IP address, email address, password, and other data you collect?
Here is an article to learn more about termination clauses.
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