Do you adequately inform your customers about the existence and scope of your terms and conditions?

In order for consumers to be bound by your terms and conditions, you must adequately inform them of the existence and scope of the obligations imposed on them under your terms and conditions prior to the formation of the contract. Furthermore, the consumer must have actually read the terms and conditions and must have explicitly accepted them before they can apply to him or her. This acknowledgment and acceptance of the general terms and conditions by the consumer often occurs through a reference to them on the back of the order form or quote and/or by checking a box on a website to acknowledge and accept the general terms and conditions. This practice is common and is generally accepted by the courts. However, this does not mean that a company can simply hide any clause in its general terms and conditions and thereby bind the consumer to it. In fact, the Court of Cassation recently ruled that there is no (actual) acknowledgment and acceptance of general terms and conditions when these terms of sale contain “unusual, excessive, or onerous” clauses. A business is not permitted to hide unusual or onerous clauses in its general terms and conditions on the back of an invoice or a quote. The Court has ruled that a consumer, who is generally inclined to skim through such lengthy terms, is not sufficiently informed in this case about the scope of such clauses. According to Supreme Court case law, the business must explicitly draw the consumer’s attention to such clauses prior to the conclusion of the contract. If the business fails to do so, such clauses are not binding on the consumer. The lack of prior information can therefore have far-reaching consequences. After all, as a business, you subject the consumer to terms and conditions of sale to protect your business—a protection that may be lost if you do not adequately inform the consumer about them. Exactly what constitutes such “unusual, excessive, or onerous” terms will have to be determined by case law. It is likely that this will primarily concern clauses that entail significant financial repercussions or that may impose long-term obligations on the consumer. In the case decided by the Court of Cassation, the Court ruled that the seller was required to explicitly draw the consumer’s attention to a onerous cancellation clause under which the consumer—barring force majeure—could cancel the contract only upon payment of 30% of the price. According to the Court, a mere reference in this case to the terms and conditions of sale printed on the back of the order form is insufficient under these circumstances; consequently, the cancellation clause was declared unenforceable, and the company could not claim the 30% compensation.

As a business, you will need to determine which terms can be considered excessive or onerous—which is no simple task. In addition, it must be clear to the consumer which terms are onerous. Do you include them in the special terms and conditions of your contracts? Do you use a different layout to highlight this clause? Are there other possible ways in which your company can comply with this pre-contractual information obligation, etc.? If you would like to review your general terms and conditions or seek further clarification on the options for amending your general terms and conditions, order forms, and/or quotes, please do not hesitate to contact Crauwels Advocaten.