Courts have enforced arbitration agreements arising from clickwrap agreements, even when the user has not bothered to read the fine print. A recent New Jersey appellate court has held, though, that mere reference to terms and conditions (including a hyperlink), which did not require the user to acknowledge or assent to those terms and conditions, was not sufficient to establish an agreement to arbitrate.
A homeowner went to the HomeAdvisor website to find the names of reputable contractors. The website did not allow submission of a service request or viewing of prospective contractors, unless the homeowner clicked a “View Matching Pros” button. Directly below that button was the statement “By submitting this request, you are agreeing to our Terms & Conditions.” The words “Terms and Conditions” were a hyperlink to a separate seven page document. And the arbitration agreement was on the last two pages of the seven-page document.
There was nothing to alert a website visitor to the arbitration clause. There was no “click to accept” button for the terms and conditions. One could click the “View Matching Pros” button without ever seeing the terms and conditions. In fact, the court noted that the reference to the terms and conditions was below the button and might not even be read by the normal viewer before clicking to view prospective contractors.
On this record, the appellate court held that the HomeAdvisor agreement was like a browsewrap agreement, which ostensibly applies to anyone visiting the website. In that setting the enforceability of the terms may depend “on whether the terms or a hyperlink to the terms are reasonably conspicuous on the webpage.” The court held that “the hyperlink at issue did not provide reasonable notice of HomeAdvisor’s terms and conditions to the reasonably prudent internet user.”
Absent affirmation that the terms and conditions had even been viewed, much less accepted, the court held that HomeAdvisor had failed to demonstrate the homeowner’s agreement to arbitration.
In the context of webpages, courts will look for an arrangement that requires a user to view the pertinent agreement (or be given the chance to do so) and – more importantly – to specifically acknowledge assent to the terms of such an agreement, before concluding that an arbitration clause has been agreed to.
The case is Wollen v. Gulf Stream Restoration & Cleaning, LLC, 2021 N.J. Super. LEXIS 94 (July 9, 2021).
© 2021 Commonsense Construction Law