Business Law & Compliance
Are there hidden dangers buried in your firm's Ts and Cs?
5 min read
03 October 2013
Businesses are unknowingly exposing themselves to huge risks via poorly-written or plagiarised terms and conditions, according to Marc Yaffe of JMW Solicitors
The internet has brought many benefits to businesses but it has also provided numerous pitfalls. For almost all companies it is now seen as essential to have an online presence. But the internet also makes plagiarism – using someone else’s words, work or ideas as your own – very easy to commit.
Stealing terms and conditions – the necessarily wordy, complicated statements that set out how a company trades with its customers – can be tempting. Done properly, they tend to be drawn up by lawyers, a cost many are tempted to cut. It is not hugely surprising, then, that some companies copy their terms and conditions from competitors rather than creating their own bespoke ones. I have seen a marked rise in such cases in recent months.
For a business using these duplicated terms and conditions, there are two main risks. The first is a straightforward action for copyright infringement. Terms and conditions are designed to be unique and comprehensive documents. They take time and skill to draw up. If you plagiarise another company’s you are likely to be infringe its copyright. This could be very costly indeed. One of the remedies available to courts in copyright infringement cases is to order an account of profits flowing from the infringement. Given that these words govern pretty much every part of how a company trades online, it could lead to a large pay-out.
Secondly, terms and conditions set out the relationship between your business and your customers. If they are not bespoke, all manner of problems could arise. Terms and conditions, for example, often set out payment terms, termination provisions and other important contractual clauses. Without your own, your business could be vulnerable should you have a dispute with a customer or someone owes you money.
So why is this coming to a head now? Certainly there is, and has been for some time, a growing realisation of the importance of trading online. Businesses now fastidiously guard their online intellectual property, and rightly so. There is also the constant improvement of internet search to consider.
Thanks to enhanced analytics products, it is now much easier to track down potential cases of plagiarism via tools like keyword searches or even through the use of robots. Another aspect to consider is the growth of the digital companies that build websites for businesses.
These firms create sites often on slim margins and tight deadlines, so there is likely a temptation to swipe ‘generic’ terms and conditions for their clients. For web designers, it is important to ensure that the client is responsible for providing its own terms and conditions.
If this has set alarm bells ringing, then act quickly and be vigilant. Revisit your terms and conditions and check they are bespoke, particularly if your website has not been updated recently or was built externally. Using a lawyer to draw up your terms and conditions is not necessarily vital but it does offer the advantage of protection – your solicitor will carry the can if the wording is found to be inadequate or infringes copyright. Be aware, too, that your own terms and conditions could be stolen. If you’ve paid for bespoke ones, remember they could easily be copied. If you suspect this, seek legal advice.
Above all remember the importance of terms and conditions. They can feel like an unnecessary expense when you least need it, but like so many other things with your business, they are an investment worth making. As a litigator I know only too well that a little money spent on being proactive can save a huge amount if you have to respond to allegations of copyright infringement.
Mark Yaffe is a commercial litigation partner at JMW Solicitors.