LEGAL BUSINESS TERMS – DO MY TERMS NEED TO BE SIGNED?
One of the questions that we frequently get asked about legal business terms is “Do I need to get my business terms and conditions signed by my clients”.
Proving what’s been agreed
Most of the time your business runs without any problems. However, if there’s a problem you need to be able to prove that your Clients have
- had the opportunity to read and
- agrees to your Terms and Conditions.
For example, your client thinks that something is included in your services (such as your unlimited email support). Your Terms and Conditions explain that it’s not. You’ll need to show and prove what your Terms and Conditions say and that your client agreed to them.
So how can you prove that your client has agreed to your business terms?
You can do this in one of the following ways:
1 Written signature – legal business Terms?
You can ask your client to sign your Terms and Conditions.
If you meet the client in person, you can ask your client to sign a printed copy of your Terms and Conditions using a pen. Alternatively, if you’re dealing with clients online or via the telephone you could ask them to either:
- print and sign a copy of your Terms and Conditions and then scan that signed document and email it to you.
- use electronic signature software or App, such as Docusign https://go.docusign.com/ which is usually much easier for them.
Either way, you will then have a record to prove that your client has seen and agreed to your Terms and Conditions.
Which is best – signatures signed in pen or electronic signatures?
In most cases both are equally valid and legally binding. However, you need to:
- use a reputable electronic signature software or App (they keep a record of who signed and when it was signed etc).
- keep a record of the email in which your client returns their scanned signed document with a copy of the scanned signed document.
Do you need to keep hard copies of the signature for legal business Terms?
You can store the signed Terms and Conditions electronically provided you can easily print a hard copy if you need to. However, consider keeping a pen signed original document if it’s a high value sale/order.
2 In the Proposal/schedule of work or email agreeing the services you’ll provide
Some businesses give their clients a separate proposal/schedule document before the client finally agrees to buy. This document explains what work will be included. You might send a separate formal document like a schedule or proposal. Alternatively you could include it all in an email explaining what work you’re going to do. Either way, you need to make sure that your client knows what your Terms and Conditions of business are.
This means referring to your Terms and Conditions in that proposal/schedule document by saying something like:
“All our work is subject to our usual terms and conditions.”
You then must make sure that either you either
- have a working link to the words terms and conditions in your proposal/schedule or email. This is so that the buyer can click on the link and read them.
- attach a copy of your terms and conditions and refer to it. For example, “Our usual terms and conditions are attached to this Proposal.”
Then, when you send the proposal/schedule or email to the Client
- use a read receipt method (so you can prove that the email/proposal was sent to the client). OR
- preferably, ask the Client to email you to formally accept the Proposal or agree to the services.
(3) The Tick box – for legal business Terms
If you’re operating online you can use the “tick box” method. We’re all familiar with agreeing to terms and conditions in this way. This is the little box that you have to “tick” before you finalise a purchase. It’s usually something like this:
The words ‘terms and conditions’ must contain a link to your terms and conditions. The careful buyer will click on the link and read those terms and conditions. As a seller you need to make sure that they are available for the buyer to read BEFORE they make a purchase from you.
You also need to make sure that your website records the fact that clients have ticked this agreement box. This is so that you can rely on this if you ever need to.
Which method is best for legal business Terms?
You need to be able to prove your clients have
- had the opportunity to read
- agreed to your Terms and Conditions.
Any of the methods will do this but if it’s a valuable sale/order consider using the Written Signature method.
You can read about why you need business Terms and Conditions here
If you’d like to read about the 4 common mistakes made in business Terms and Conditions, find them here
If you’re looking for legal business Terms and Conditions for your service business you, we can help.