Online Store: Top 8 Things to Include in Your Terms and Conditions

Author: Ian Aldridge, Progressive Legal

By requiring customers to accept your terms and conditions before purchasing products on your online store, you are creating a legally binding agreement between you and the customer.

Online shopping is a booming enterprise, so it’s important you, as on online store owner, have thorough terms and conditions that establish the terms upon which customers purchase your products and protect you from possible risks.

Here’s what we recommend you include in your terms and conditions for your online store:

1. Payment Terms

It is important to include in the terms and conditions how customers are to pay for your products. It is common to require full payment of a product before it is shipped.

This approach saves you the hassle of chasing customers for payment and you aren’t left out of pocket. It’s useful to specify that payments are operated through an online and automated billing system by using a default payment provider like PayPal, Zipay or Afterpay.

2. Refunds

It’s inevitable some customers will want to return products bought online, possibly because they simply changed their mind or because the product itself was faulty. Having a robust refunds section in your terms and conditions will help you navigate this.

You are not legally obliged to provide refunds for change of mind purchases, but you can choose to, at your discretion, and add in some wording in the terms and conditions to that effect.

Alternatively, you could instead include in the terms that refunds will be assessed on a case-by-case basis, while still complying with Australian Consumer Law (this will be discussed further below). In any case it should be a requirement that any customer seeking a refund must provide proof of purchase.

3. Australian Consumer Law

The Australian Consumer Law creates certain obligations that must be upheld when selling products. It also states you must provide specific warranties as to the quality of the products you sell and that the products are fit for purpose.

In the event the products you sell are reported as faulty or are not fit for the purpose they were created for, you must exchange the product for another, repair it or provide a refund. Failing to do so would be a contravention of the Australian Consumer Law.

It’s a good idea to include in the terms and conditions that nothing in the terms is intended to exclude or limit a customer’s rights under Australian Consumer Law.

4. Disclaimers

As a seller, you want to reduce your exposure to risk as much as possible and disclaimers are a great way to achieve that. They act to limit your liability in many respects. There are several disclaimers that can be used in the terms and conditions. Some examples include:

• The seller does not make any guarantees, warranties or representations about the products, except those implied by Australian Consumer Law;
• that everything on the website is provided on an “as is” and “as available” basis;
• the seller does not assume any liability whatsoever arising out of the application or use of any product; and
• specification and particulars in relation to the products referred to in the website are subject to change without prior notice.

For more information on disclaimers visit our disclaimers page.

5. Copyright and Trade Mark Notices

It is crucial to flag to customers that all the material on the website is subject to copyright and may not be copied or reproduced in any way without prior written consent. It should be communicated that any attempt to modify any material on the website is a violation of copyright.

An important thing to include in the terms and conditions is that the customer acknowledges that they do not acquire any copyright or trade mark ownership rights by using the website. It is also worth including that the registered or unregistered trade marks, logos, and service marks displayed on the website to denote your brand are owned by you, the seller, and may not be used in connection with any product that does not belong to you, in any manner that is likely to cause confusion with customers, or in any manner that disparages the business.

Enquire with our experienced IP lawyers for any advice in relation to trade marks and copyright.

6. Indemnity

For extra protection, you should include a section that covers indemnities, where the customer commits to compensate you for any harm, liability, or loss suffered by you arising out of the customer using, or attempting to use the information from the website, products, services, or for any breach of the terms and conditions

7. Limiting Liability

To the extent you are permitted under Australian Consumer Law, you should state in the terms and conditions that your company is not liable for any damages whatsoever arising out of or related to the use, inability to use or reliance upon the website or the use of its products.

You should also include that in no event will you be liable, in contract, tort (including negligence) or otherwise, for any direct, indirect, special or consequential loss, damages or reliance in connection with the products, the website or the online store.

8. Dispute Resolution

Disputes can arise from time to time, so it’s wise to include a section that addresses how they will be dealt with. You don’t want a matter to be escalated to court proceedings at first instance and amass exponential costs.

To avoid this, it’s common to include a section in the terms and conditions that states the parties to a dispute are required to attempt to resolve it among themselves, and if the matter isn’t resolved in, say 5 days, for example, the matter is to be referred to mediation.

This saves the parties the significant cost associated with having the matter dealt with in court and can provide a speedier resolution.

Key Takeaways

There’s a lot more to terms and conditions for an online store than first meets the eye.

It’s essential customers are clear about the terms upon which they are purchasing products, what their obligations are and what you, as the seller, are not liable for. When everyone is clear about the terms and conditions, there is less chance you will run into trouble with customers down the track.

While selling products online is a great way to reach a bigger market, there are many risks associated with it that strong terms and conditions help to greatly reduce.

Our experienced commercial lawyers can draft terms and conditions for your online store for a fixed fee starting from $1,400 + GST, fully tailored for your business and drafted by a qualified lawyer.

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