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How enforceable are online terms and conditions?

Do online terms and conditions still create binding contracts?



online terms and conditions - nairametrics

There are many reasons why a company may want to provide its terms and conditions online. The benefits include shorter contracts, reduced paper waste, ease of access and distribution and the desire to have uniform terms. However, is it enforceable when businesses utilize these types of hybrid arrangements? In other words, do online terms and conditions still create binding contracts?

An online contract is conceptually very similar to and is drafted in the same manner in which a traditional paper-based contract is drafted. In the case of an online contract, the sellers who intend to sell their products, present the products, prices and terms for buying such products to the prospective buyers. In turn, the buyers who are interested in purchasing the products either consider or click on the ‘I Agree’ or ‘Click to Agree’ option to indicate the acceptance of the terms presented by the sellers, or they can sign electronically. Once the terms are accepted and the payment is made, the transaction can be completed. The communication is basically made between two computers through servers.


Online contracts can be categorized into two: browse or web-wrap contracts and clickwrap contracts. Other kinds of online contracts include employment contracts, contractor agreements, consultant agreements, sale re-sale and distributor agreements, non-disclosure agreements, software development and licensing agreements, and source code escrow agreements. Though these online contracts are witnessed in our everyday lives, most of us are not aware of the legal complexities connected to them; the use of online contract faces many technical and legal challenges.

Clickwrap Contracts

Given the emphasis placed on a user’s assent, courts favor a binding agreement where the user engages in affirmative conduct, acknowledging the terms of an agreement. For instance, a genuine clickwrap agreement, in which a service provider places the terms of service just adjacent to or below a click-button (or check-box), has been held to be sufficient to indicate that the user agreed to the listed terms. In these cases, requiring the user to click “I Agree,” after calling attention to the terms and affording the user an opportunity to review them, demonstrates that the user agreed to the terms. However, courts generally do not require that you actually have read the terms, but just that you had reasonable notice and an opportunity to read them.

Users will then have to actively accept the terms and conditions by “clicking” into a box with words like:

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“I accept” or “I have read the Terms and Conditions and I agree to be bound by them” (a thorough attempt to make sure the customer knows this is a legal contract).

In other words, it’s not merely clicking the “I Agree” button that creates the legal contract. The issue turns on reasonable notice and opportunity to review —whether the placement of the terms and click-button afforded the user a reasonable opportunity to find and read the terms without much effort.

Mechanisms for creating a binding contract

A clearly presented clickwrap agreement represents the “best practice” mechanism for creating a contractual relationship between an online service and a user. Such a mechanism should:

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  1. Conspicuously present the terms to the user prior to any payment (or other commitment by the user).
  2. Allow the user to easily read and navigate all of the terms (i.e. be in a normal, readable typeface with no scroll box) – Don’t make it difficult to find them by requiring the user to go through multiple steps to get there. Be clear about what constitutes an acceptance of legal terms. Vague references to binding legal terms and conditions—such as labeling a link “Legal”—may not provide sufficient notice.
  3. Provide an opportunity to print, and/or save a copy of, the terms;
  4. Offer the user the option to decline as prominently and by the same method as the option to agree; and
  5. Ensure the terms are easy to locate online after the user agrees ( i.e., there is a clear reference to where the terms can be found). Parties should attempt to use a direct link, such as the online terms and conditions found at, or something similar. Courts are especially skeptical where service providers do not place links to terms, or references to them, in conspicuous locations so as to notify the user that they even exist.

Browse-wrap Agreements

A browse-wrap agreement will place the vendor in a weaker legal position because it does not provide the same degree of reasonable notice to the user; it is not recommended for business owners.

For a browse-wrap agreement to be enforceable, the website must give the user actual or constructive notice of the agreement and the user must consent to the agreement. Unlike a clickwrap agreement, a user does not need to take action to affirm his consent to be bound. Instead, the agreement typically states that use of the website is deemed acceptance of the agreement. However, courts are more likely to enforce clickwrap agreements than browse-wrap agreements.

The main problem with browse-wrap agreements is that they are written in a manner that gathers consent by the user’s action, such as browsing a website. Therefore, the consent is implied and might be harder to prove when seeking to enforce the agreement.

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Best Practices

If your business is looking to use any of the methods of online contract, consider the following:

  1. Clearly displaying the legal agreement in a clear and noticeable location on the website or within the mobile app, before displaying the products or the services.
  2. Making the method of acceptance or denial unambiguous.
  3. Clearly indicating that by accepting the agreement, the user is on notice of the legal contract that they explicitly consented to.

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FG to shut Third Mainland Bridge for 6 months  

The Third Mainland Bridge is the longest of three bridges connecting Lagos Island to the mainland. 



The FederalThird Mainland Bridge, Housing: Tackling Nigeria’s huge housing deficit, Nigerian roads are not that terrible, Fashola says 

The Federal Government has announced plans to shut down the Third Mainland Bridge for maintenance work from July 24, 2020. 

This was disclosed by the Federal Controller of Works in Lagos, Mr Olukayode Popoola, during an interaction with the News Agency of Nigeria (NAN) on Monday July 6, 2020. 


In the conversation, Popoola said that consultations were on for another phase of repair works to commence on the Third Mainland Bridge. He told the News Agency of Nigeria that the consultations were towards developing a perfect traffic management architecture that will be very efficient and effective. 

According to PopoolaWe want to do maintenance work on Third Mainland Bridge very soon. Most likely on the 24th. We may close it from 24th of July.’’ 

READ ALSO: Update: FG increases fuel price to N143.80 per litre

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“We are still working out the modalities and when we perfect the traffic management plan we will move to site. Everything being expected for the repairs of the bridge arrived the country that is why we want to start the repairs now,’’ 

The 11.8km bridge which has gone through series of rehabilitation works was last closed for repairs in August 2018 for 3 days of investigative maintenance check. 

Thereafter, some components needed for completion of repairs were sourced abroad because they were not available locally. 

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Meanwhile, a monitored report from Channels suggests that the closure might last for a period of 6 months.

READ ALSO: Nigeria to raise N163.32 billion through road concessions programme

There has been reports of some worn-out joints of the bridge, which has raised some serious safety concerns for the users of the bridge. The federal government will be working with the Lagos State Traffic Management Agency (LASTMA) on how best traffic during this period. 

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The Third Mainland Bridge is the longest of three bridges connecting Lagos Island to the mainland. 

The bridge starts from Oworonshoki which is linked to the Apapa-Oshodi Expressway and the Lagos-Ibadan Expressway and ends at the Adeniji Adele Interchange on Lagos Island. 

It was opened for use 1990 and was the longest in Africa until 1996 when The 6th October Bridge in Cairo was completed. 


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FRC orders the Big Four to separate auditing from consulting services

The Big Four firms now reportedly generate the largest portions of their revenues from consultancy services.



Big Four

The world’s four biggest audit firms —KPMG, PwC, Ernest & Young, and Deloitte — have been directed by the Financial Reporting Council (FRC) to plan towards separating their audit services from their consulting services.

The deadline for compliance with this directive is June 2024.


A statement that was published on the FRC website said this directive is ‘world-leading’. The statement also explained why it became imperative to separate the firms’ operations towards ensuring that they deliver the uttermost quality audit services for the good of public interest.

By the time the operational separation officially takes effect starting from June 2024, FRC said it would be expecting the following outcomes:

  • That audit practice governance would prioritise audit quality and protect auditors from influences from the rest of the firm that may try to divert their focus away from audit quality.
  • That the total amount of profits distributed to the partners in the audit practice does not persistently exceed the contribution to profits of the audit practice.
  • The culture of the audit practice prioritises high-quality audit by encouraging ethical behaviour, openness, teamwork, challenge and professional scepticism/judgement.
  • Auditors act in the public interest and work for the benefit of shareholders of audited entities and wider society.

While commenting on this development, FRC’s Chief Executive Officer, Sir Jon Thompson, said the FRC is committed to reforms on how corporate finances are reported. Further aspects of the reform package will be introduced over time, he said.

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“Operational separation of audit practices is one element of the FRC’s strategy to improve the quality and effectiveness of corporate reporting and audit in the United Kingdom following the Kingman, CMA and Brydon reviews. Today the FRC has delivered a major step in the reform of the audit sector by setting principles for operational separation of audit practices from the rest of the firm. The FRC remains fully committed to the broad suite of reform measures on corporate reporting and audit reform and will introduce further aspects of the reform package over time,” Thompson stated.

Do note that the FRC reached this decision after engaging in extensive discussions with the Big Four. It was also agreed that the audit firms will submit an implementation plan to the FRC latest by October 23rd, 2020.

Recall that it was just last week when Nairametrics reported how the Big Four earned the sum of N7.53 billion as audit fees from Nigeria’s most capitalized firms in 2019. Interestingly, these firms now reportedly generate the largest portions of their revenues from consultancy services. As a matter of fact, only about 20% of their revenues now come from auditing fees.

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Analysts predict outlook for naira as forex unification plans gain momentum

The exchange rate could strengthen this week based on a positive set of assumptions.



Central Bank Continues intervention in Forex market to stabilize Naira, Naira to depreciate slightly over $1.52 billion maturing contracts expires, Naira hits N388.84 to $1 at the currency spot market, Investors and Exporters (I&E) window, Naira weakens against the dollar by 1.14% amidst uncertainty, Naira gains against the dollar at I&E window, forex liquidity up by 242%  

The exchange rate between the naira and dollar may move in the positive for Nigeria’s local currency, according to views of a cross section of traders and analysts interviewed by Nairametrics.

Last week, Nairametrics reported that the Central Bank of Nigeria (CBN) had increased the bid price for FX at its Secondary Market Intervention Sales (SMIS) window by 5.6% to trade at N380 to $1. This was in line with the apex bank’s plans to unify the exchange rate towards the NAFEX rate.


As traders mulled the implication of the latest move by the CBN, the naira depreciated against the dollar at the parallel market to trade at N461.00 to $1, while gaining against the US dollar to trade at N386 to $1 at the I&E window. However, the exchange rate could strengthen this week based on a positive set of assumptions.

READ MORE: NSE Lists LAPO Microfinance Bank’s N6.2billion bond

A treasury dealer at Nigeria’s biggest bank by assets told Nairametrics about the Central Bank’s continual intervention in the currency spot market and outlook for the naira. He said:

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“The CBN will sustain its interventions in various windows with injection of $100million to Invisibles and Small and Medium-scale Enterprises (SMEs) segment at ₦384 to a dollar. Also, the CBN will inject c.$250million through the Retail SMIS on Friday.

“With the increase in base rate at last week’s Retail Auction to $/₦380 from the $/₦365, I expect similar revision of the official rate from $/₦361 to IEFX level in line with rate unification exercise which would boost Naira revenue from crude oil sale and qualify the CBN to draw-down from the IMF/World bank loan.

“The paucity of funds that IEFX window has experienced since the start of the Q2 will persist this week. Though, I expect the CBN to come up with plans to clear the backlogs of FX demands estimated at c. $5bn for offshores investors just like it did in 2016. Nevertheless, I expect Naira to trade at sub $/₦400 levels throughout the week.

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READ ALSO: Forex liquidity up by 315% as Naira gains marginally at I&E Window

“With this move in unifying the exchange rate system, it is also expected that the present converging of the rates estimated at N387 to $1 (I &E Window) will boost revenues for the federal government which could see a gain of N20 on every US dollar earning in oil.”

Whilst the debate rages on about what the true value of the naira is, several factors are at play. The CBN Governor had alluded to the fact that the lull in business activities suggested that forex demand should be low, thus calling into question the pent-up demand being highlighted by several market analysts.

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The Central Bank governor suggested that the black-market rates being reported were likely not representative of what the real demand was, but rather driven by speculative forces.

Michael Nwakalor, Macroeconomist at CardinalStone Research, in a phone chat interview with Nairametrics expressed optimism on the naira appreciating at the black market this week. He said:

“Amid purported pressure from multilateral organizations for a unified exchange rate, the naira has noticeably weakened at both the NAFEX and parallel markets in recent weeks, with reports of a devaluation at the SMIS window from N360/$ to N380/$.

“We expect a possible unification to converge towards the NAFEX rate of N385/$ and if supported by increased FX supply and clear body language by the CBN, we may also see a steep recovery in the parallel market towards that rate. In the absence of this, we expect a characteristically quiet week in the FX market.”

Conversely, market analysts believe that the reluctance of the CBN to fund liquidity shortages at the I&E window is the reason why the black market has depreciated to about N461/$1. They claim legitimate transactions have already taken place in the parallel market, especially for businesses that have obligations to meet but cannot access forex from official windows.


Thelma Ugonna Ohiri-Anyanwu, CFA, a leading financial expert in a Nigerian tier-1 bank, was also optimistic about the naira stabilizing this week. She said:

“With the CBN devaluing the currency by 5.3% from N360 to N380 at its latest currency auction, this saw the market close at about N389 to a dollar. This I believe is in a bid at unifying the rate at the various windows.

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“In the coming week, with little or no significant activities to stimulate the market and no fundamental change, the naira will be relatively stable.

“The I&E window will likely trade around N388-389/$ levels. While the parallel market at N460 to 461/$ levels.”

CBN’s foreign reserves fell slightly during the week as FX outflows outpaced inflows. Data from Nigeria’s central bank showed that its foreign reserves stood at about $36.2billion.

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