If you have a website disclaimer, does it have to be reasonable?
If you want it to work for you, then yes it does!
Your very first step is to login and check whether you have one, and what your website disclaimer says.
Do you have a website disclaimer? If you do, have you read it? Did you get your website designer to put a disclaimer on your website from goodness knows where? That is risky.
You might have a disclaimer as part of your website terms and conditions, or sitting on a separate link. Your disclaimer might include a limitation of liability, and it might not.
Now you have found your website disclaimer you might wonder why anyone would ask about the reasonableness of of it. Aren’t disclaimers supposed to protect you from ridiculous lawsuits?
The thing is, consumer protection laws around the world are written to protect consumers. It is assumed that if you are in business then you know more than your customers and should take steps to protect them.
[As an aside – Small business in Australia is worth about 46%* of our Gross Domestic Product, and about 80% of all new small business fail in the first 3 years… so maybe business owners are not better off than consumers, but this is the law we’ve got]
Under consumer protection laws you have responsibilities to your customers that cannot be avoided through by using a website disclaimer. In fact, if you try and avoid your consumer responsibilities, then your website disclaimer can be deemed void and you can be fined – which defeats the whole purpose of having a disclaimer in the first place!
So, if you are selling products or services to Australian Consumers, here is what you need to know:
- You can expect your customers to exercise some care in their purchase of your products or services;
- You have to comply with the Australian Consumer Guarantees;
- Your website disclaimer cannot breach your obligations under Australian Consumer Laws;
- Your terms and conditions, including any website disclaimer, must be reasonable and not unfair.
Have you ever seen one of those website disclaimers that tries to say that the business owner is not responsible for anything, at all, whatsoever and definately not consequential losses? I have, and they are not likely to be enforceable in Australia.
To protect your business your website disclaimer DOES have to be reasonable.
But what is reasonable? A common test for what is reasonable is to say “What would an ordinary customer in the same circumstances have expected from your product?” If you sold someone a bicycle and then said that you can’t be responsible for someone using it as a bicycle, then your disclaimer is probably not reasonable, and to be frank, why would anybody buy a bike from you if you did that?
As an example, let’s consider paint.
If you are selling external all weather paint with a 10 year guarantee, you can’t then disclaim that it can be used outside in the weather.
You might have a special type of paint that adheres better to metal than to wood. Then you could use a disclaimer in the form of a simple statement “recommended for metal surfaces, not suitable for wooden surfaces” to say that it is especially suitable for metal and not wood. Then if a customer uses it on wood and complains that the paint is peeling after only 12 months, you can rely on the statement and may be able to avoid having to pay for repairs or replacement paint.
After all, you were clear, the customer made a choice to either ignore your notice or risk that the paint might not work as well on the wood. It is reasonable expect that your customer read the label. Of course, this might be affected by where your disclaimer sits on the label on the paint tin and the size of the writing. If selling through your website, you should include any disclaimer like that in the product description before the customer can click through to purchase the product.
We’ll look at where disclaimers should appear on your website in a later post.