With e-commerce divisions becoming standard practice for independent designers and retailers, it is important to set terms and conditions to prevent issues. Lawyer Krystil Carter offers advice.
In 2010 it is difficult to find a retailer that doesn’t sell its products online or have plans to do so. And with the increasing move towards online sales, there is a need for designers to have an air-tight and easy-to read set of terms and conditions to govern sales of their products online.
Tips for drafting your own terms and conditions
At the outset, it is important to remember that your terms and conditions are exactly that: the terms on which you are willing to do business. There is some flexibility regarding what can be incorporated in your terms and conditions, but this flexibility is limited.
Your terms will typically overlap with other areas of law (such as trade practices law) and some issues can’t be ‘contracted out’ of and must be adhered to by your business. For example, some matters you have flexibility over include insurance and delivery of the product and whether you want to accept returns for ‘change of mind’ purchases.
Matters that you can’t ‘contract out’ of include terms implied by trade practices law, such as the basic guarantee as to your products’ saleability (for example, your products must ‘be fit for their intended purpose’ and be of ‘merchantable quality’).
Writing terms and conditions isn’t rocket science, but there are a few things you should know. Nothing substitutes for getting expert legal advice to ensure you’re on the right track. However, here are some useful starting points when creating your own terms:
• Consider what you need to include on your terms and conditions page. It needs to clearly state what your site is about, what service it provides and how it provides that service. Questions you may want to ask yourself include what problems could someone encounter by using your site, what does your site not intend to do and what risks are or aren’t you willing to accept.
• Organise your issues and concerns into logical topics. Some topics that are typically addressed include registration, eligibility, placing orders, refunds and exchanges, privacy, intellectual property, contact information, affiliations or website partner.
• Begin writing your terms and express them in a clear and user-friendly tone. Making your terms easy to understand will help you avoid confusion and give your site more visitor appeal. Remember the document is a contract and is therefore a legal document. But it does not have to be written in an overly legal voice or be too demeaning.
• Carefully review your terms and conditions for spelling and grammar, then review for accuracy. If issues arise that are not included in your terms, update them and be sure to let your customers know that updates have been made. Give the terms to a friend and ask them for feedback prior to publishing the terms and conditions. Be aware that writing terms and conditions is an important process that takes time. Give yourself enough time to explore the liabilities you are exposed to and always have a firm grasp of the laws that pertain to your online store. If you don’t know the laws, get expert legal advice.
Can I look at another designer’s terms and conditions and use that?
Whilst looking at the terms and conditions of other designers may be a useful starting point, it is not advisable for a number of reasons. One of the most important reasons is that you will have no comfort that the terms and conditions of a fellow designer have been appropriately drafted according to the relevant laws.
Even if you know that a fellow designer’s terms and conditions have been drafted by a lawyer, the lawyer’s advice (and therefore the terms drafted as a result of that advice) will be specific to the designer, which means that the terms and conditions drafted as a result of that advice will not necessarily be applicable to you.
What are the benefits of having well drafted terms and conditions?
There are numerous benefits, both legal and commercial, for having a well drafted set of terms and conditions.
• From a legal perspective, you will protect your business should anyone mistakenly use your information for the wrong purposes or attempt to hold you liable for damages they have incurred by using your website or its information.
• From a commercial perspective, it clearly communicates to your customers how you’re going to do business which leads to pleasant shopping experiences and greater customer loyalty.
• Finally, and from a commercial perspective again, if your refund and exchange policies are clearly stated, your employees should have a clear and consistent set of guidelines on how to carry out the businesses objectives in relation to online sales (particularly for returns and exchanges). So there’s fewer mistakes and less time spent fixing them. Overall, a well-drafted set of terms and conditions will lead to a healthier bottom line and an improved reputation for your brand.
Krystil Carter is a lawyer with Melbourne-based law firm Gibsons Solicitors, which specialises in brand protection and enforcement, intellectual property and media and entertainment. Gibsons has a diverse portfolio of clients including leading textile companies and fashion designers.