Contracts are everywhere, you probably agree to one in some form multiple times a day (maybe without even realizing it). If you’ve been around here, you know we LOVE contracts at Destination Legal, they are super important for online businesses for so many reasons. But what you may not realize is that there are actually a variety of types of contracts, so let’s dive into that today.
- Express Written Agreements: These are the most common form of contracts. They are typically drafted on paper and signed by the parties involved. A well-drafted traditional contract clearly outlines the terms and conditions, responsibilities, and obligations of each party. Today most (probably 90%) of contracts are signed with electronic signatures (e-signatures). E-signatures are legally binding and can be used for various types of contracts. E-signing platforms (check out some of our favorites here) provide a secure way to sign documents electronically.
- Oral Agreements
- Verbal Contracts: In some situations, verbal agreements can be legally binding. However, these types of contracts can be challenging to enforce because they often lack clear documentation. Verbal agreements are more commonly used in everyday transactions, like buying goods at a store versus in the online space.
- Implied Contracts: These contracts are formed through the actions or behavior of the parties involved. When parties act in a way that suggests an agreement, even without explicit verbal or written terms, an implied contract can be formed. For example, when you order food at a restaurant and eat it, there's an implied contract to pay for the meal. In the online space this can be tricky because some people think that an email exchange or DMs create an implied contract (eg, this is what Coach X said would be included but now she’s saying no). Similar to verbal contracts, these can be really difficult to enforce.
- Online Terms
- Online Agreements: When you make online purchases or use software and websites, you often encounter online “Terms of Purchase” or “Terms & Conditions” agreements. These are agreements presented to you as pop-ups or checkboxes that you must agree to before proceeding. Clicking "I Agree" signifies your consent to the terms and conditions. These are considered just as legally binding as signing a contract.
- Footer Agreements: These agreements are often found as links at the bottom of a webpage. By visiting or using the website, you're considered to have accepted the terms and conditions. However, the enforceability of these agreements can be more challenging to establish which is why you always want Terms of Purchase to be agreed to as above.
There are other kinds out in the world but these are the main ones that impact us here in the online space!