Yes, Your Website Needs a Terms of Use Policy

Recently, we posted a blog laying out the importance of a website’s privacy policy.  A quality privacy policy, however, is only half of the equation when it comes to protecting your website.  To truly protect yourself and your business, you need a comprehensive agreement that legally binds your users and regulates their actions on your site.  This is where a Terms of Use Policy comes into play.

While the law requires that your website have a  privacy policy if you collect the personal data of your visitors, there is no such regulation requiring  a Terms of Service Policy be posted on any website.  But just because they are not required does NOT mean that quality Terms of Service are not vitally important to you and your business.

What Is It?

A Terms of Use Policy, also called Terms of Service or Terms and Conditions, is a legal agreement established to govern the relationship between your website and your visitors.  It sets the rules that all users must agree to in order to use your site, while serving to limit your liability in the event that one (or many) of your users decide to bring litigation against you or your business.  It also provides important and valuable information on a range of topics including warranties, pricing, intellectual property and what happens in the event of a dispute.

What You Should Include in Your Policy

A well-drafted Terms of Service Policy will outline important legal disclosures and policies relating to the use of the website, the content, and communications between user and website.  Although the content that should be included will vary considerably, depending on many factors, some of the important provisions include:

  • Limitation of Liability – this may include warranty disclaimers and will notify users that the website is not responsible for inaccurate, incomplete, or missing information or features.
  • Governing Law – this sets which state’s laws will apply to the relationship between user and website.
  • Intellectual Property Clause – a declaration to all users of the site owner’s copyright and trademark rights – essentially that you own the logos, design, content (except, in most cases, user-generated content), and features of the site.
  • License and Restrictions – explains to users  the permitted and restricted activities and uses that govern their use of the website.
  • Warranties and Guaranties – for the use of the website and the products or services that may be offered or advertised on the site.
  • Dispute Resolution – a very important provision that will dictate the process and venue that users must follow in the event that a dispute arises. Often websites will include as part of its dispute resolution procedures, an arbitration provision restricting disputes to less expensive arbitration in lieu of litigation, in a location that is convenient for the business, and restricting class action lawsuits.

Your Terms of Service is your website’s contract with all your users. It protects you and your business and provides the public with an understanding of the legal policies and procedures that are attached in order to use and enjoy your site.  But just as no two websites are exactly alike, no two Terms of Use Policies should be identical.  There are many factors that must be considered when drafting a Policy in order to offer your business strong protection, while respecting the rights and expectations of your users.  If your website doesn’t have a Terms of Service in place, or it needs to be revised, speak with an experienced business attorney at The Jacobs Law, who can help guide you through this crucial process.