A terms and conditions contract puts in place a clear agreement between yourself and your customer on a full range of issues. But do terms and conditions need to be signed to be legal?
Well-written terms and conditions should cover more than just the basics, such as payment terms and how payment can be made, but should also take care of common legal concerns like limiting liability and what happens if you cannot fulfil the order due to circumstances beyond your control.
If a dispute goes as far as legal action, it is much, much simpler to have a mutually agreed terms and conditions contract in place that supersedes any statements that may have been made to the contrary in emails and letters, or in voice conversations where you have evidence of what was said.
But does that terms and conditions contract need to be signed by the customer – or by representatives of both parties – in order to be legally binding?
The simple answer is no, but as usual there are certain factors that can make the situation more complicated, and which you should bear in mind if you expect to enforce your preferred terms and conditions over your client relationships.
For instance, simply having a digital version of your Ts & Cs on your website is not proof that they have been seen by the client – so make sure you include them in a piece of direct communication, with a clear statement to the effect that they will be considered the binding terms unless the client raises an objection.
Look out for clients with their own Ts & Cs, as these are likely to contradict yours to some extent, and without a specific agreement, it might not be 100% clear whose terms take precedence.
And be certain to send your Ts & Cs as early as possible in your communication with new clients, so that you can begin to be protected by them as soon as possible too.
If, for example, you want to retain a partial deposit in the event of the client asking for a refund – or you would only be comfortable issuing the refund in the form of ‘store credit’ for future orders from your company – it is essential to spell this out very clearly, and definitely before you take the first deposit payment.
Once you have received any money from the customer, it can be very difficult to impose terms that were not already agreed, and this could leave you out of pocket if they cancel and demand a full refund.
To return to the original question, then – a terms and conditions contract does not need to be on paper and physically signed, but both parties must be aware of its existence in a demonstrable way, and not in dispute over the terms.
It may be mutually beneficial to compromise on certain terms, especially where your Ts & Cs contradict the customer’s own, but this should be done from the outset – and before any money changes hands.