Terms of Use agreements (also known as Terms & Conditions or Terms of Service) is a legal document that includes the terms for using your website or app. It lays out the terms, guidelines, and acceptable behavior, as well as any other information needed. When this is published and accessible to the public, use of the site infers acceptance of the Terms of Use. Here are a few platforms where business owners typically choose to have Terms of Use agreements:
- Websites
- Blogs
- E-commerce stores
- Mobile apps
- Facebook applications
- Desktop apps
- SaaS apps
Desktop apps are a bit different. They typically include an EULA (End-User License Agreement) rather than a Terms of Use agreement. A business could choose to use both.
Having a Terms of Use agreement isn’t legally required but having one is a smart business decision.
The top reasons you should have Terms of Use in place on your site/app:
To Prevent Abuse
Terms of Use agreements act as a legally binding contract between a company and its users. The agreement establishes rules and guidelines for users to follow to access a mobile app or website.
In your Terms of Use document, you can define what constitutes abuse and what rights you have in the event of abuse by a user. Abuse typically includes posting lewd content, spamming users, and other negative or inflammatory behavior. If you host user-generated content, your Terms of Use agreement can define what is considered harmful language.
To Enforce Ownership of Your Content
People can steal your logo or content for their own use. In a Terms of Use, you can inform users that you are the legal owner of this content and that international copyright laws protect your content.
To Establish Governing Law
Typically, the “Governing Law” clause of a Terms of Use agreement refers to the jurisdiction that covers the terms in the contract. Your Terms of Use agreement will say something to identify the city/state/province/country.
To Terminate Accounts
In addition to outlining what happens if a person abuses your platform, you can also describe the consequences. You may state within your Terms of Use that any users who abuse your platforms may be temporarily banned or permanently terminated.
The termination clause is one of the most critical parts of any Terms of Use agreement. It gives you the ability to terminate users with less liability.
Termination clauses are for websites that have a registration and login. It may be for a message board, or tool or anything else you choose for users to access by logging in. If the user is not compliant, you can terminate their account.
To Limit Liability
Terms of Use agreements help limit your liability as a business owner. By including a warranty disclaimer, these agreements can decrease your liability in cases where users find errors in the content or features on your website.
These clauses serve to notify the user that you, as the site owner, cannot be held responsible for errors or omissions or for information that is not complete, or “Suitable for any purpose.”
What do you include in your Terms of Use document?
It’s up to you – and your lawyer – to determine what guidelines and terms you want to set. In addition to the items mentioned above you will also need other Terms of Use if you are an ecommerce site. This may include things like:
Inform users about your acceptable payment terms
Update users about new or existing shipping policies
State your policy on returns, refunds policies, and more.
Tips for your Terms of Use
While some say it is beneficial to review the Terms of Use policy from other companies, you should be careful since not all terms may be applicable, and it may be missing key items you need.
Due to the importance of this document, working with a lawyer to draft it or at least review it after it is drafted, gives you the best chance of decreasing risk and liability.
Ensure that is covers you legally but is easy for visitors to understand.
Ensure your Terms of Use is personalized for your business. Ecommerce sites, for example, should include information on credit card data, refunds, returns, etc. Dentist may include cancellation policies and disclaimers.
Update your Terms of Use regularly to reflect your changing business practices.
How to display your Terms of Use
There are many ways to display your Terms of Use, although most businesses choose to add it at the bottom of their website, in the footer – often by the privacy policy and copyright information. Depending on your site and the various interaction points, you may also display it during checkout, during signup, when submitting any user-generated content, or any time you want users to be aware of your terms and get agreement to them.
Terms of Use agreements are important, very detailed and sometimes tedious but they offer important protection for you and your business.
Learn more about how CEO Law can help you with your Terms of Use documents
CEO Law offers affordable pre-set packages to meet your needs. Use our document generating engine, have one of our lawyers review an already drafted privacy policy or have one of our senior lawyers draft your agreement for you. Click here for more information.
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