- In an automated transaction, the following rules apply:
- A contract may be formed by the interaction of electronic agents of the parties, even if no individual was aware of or reviewed the electronic agents’ actions or the resulting terms and agreements.
- A contract may be formed by the interaction of an electronic agent and an individual, acting on the individual’s own behalf or for another person, including by an interaction in which the individual performs actions that the individual is free to refuse to perform and that the individual knows or has reason to know will cause the electronic agent to complete the transaction or performance.
- The terms of the contract are determined by the substantive law applicable to it.
Source: L. 2002: Entire article added, p. 852, § 1, effective May 30.
OFFICIAL COMMENT
- This section confirms that contracts can be formed by machines functioning as electronic agents for parties to a transaction. It negates any claim that lack of human intent, at the time of contract formation, prevents contract formation. When machines are involved, the requisite intention flows from the programing and use of the machine. As in other cases, these are salutary provisions consistent with the fundamental purpose of the Act to remove barriers to electronic transactions while leaving the substantive law, e.g., law of mistake, law of contract formation, unaffected to the greatest extent possible.
- The process in paragraph (2) validates an anonymous click-through transaction. It is possible that an anonymous click-through process may simply result in no recognizable legal relationship, e.g., A goes to a person’s website and acquires access without in any way identifying herself, or otherwise indicating agreement or assent to any limitation or obligation, and the owner’s site grants A access. In such a case no legal relationship has been created.
- In the transaction set forth in Comment 2, the record of the transaction also will include an electronic signature. By clicking “I agree” A adopted a process with the intent to “sign,” i.e., bind herself to a legal obligation, the resulting record of the transaction. If a “signed writing” were required under otherwise applicable law, this transaction would be enforceable. If a “signed writing” were not required, it may be sufficient to establish that the electronic record is attributable to A under Section 9. Attribution may be shown in any manner reasonable including showing that, of necessity, A could only have gotten the information through the process at the website.
On the other hand it may be possible that A’s actions indicate agreement to a particular term. For example, A goes to a website and is confronted by an initial screen which advises her that the information at this site is proprietary, that A may use the information for her own personal purposes, but that, by clicking below, A agrees that any other use without the site owner’s permission is prohibited. If A clicks “agree” and downloads the information and then uses the information for other, prohibited purposes, should not A be bound by the click? It seems the answer properly should be, and would be, yes.
If the owner can show that the only way A could have obtained the information was from his website, and that the process to access the subject information required that A must have clicked the “I agree” button after having the ability to see the conditions on use, A has performed actions which A was free to refuse, which A knew would cause the site to grant her access, i.e., “complete the transaction.” The terms of the resulting contract will be determined under general contract principles, but will include the limitation on A’s use of the information, as a condition precedent to granting her access to the information.