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August 2010

The owners and operators of websites should always remain aware of the concept of duty of care. It is important to note that for all the Acts, Regulations and rules, not all law is enshrined in statute. There is no specific Act which sets out a duty of care as between a website and its visitors. Recently however a case was heard in the Court of Appeal which sheds some light on the legal position of a duty of care owed by a website to its visitors.

It’s all in the Words

The case of Patchett v. SPATA concerned the website of a well-established trade association. The claimants obtained the details of a contractor from the website and proceeded to enter into an agreement with, and make payments to, that contractor. Before the work could be completed, the contractor in question went out of business, leaving the claimants out of pocket to the tune of tens of thousands of pounds and forcing them to have the work completed by another contractor.

The website stated, among other things, that the association’s members were fully vetted, were required to meet standards of work set by the association, and were covered by a bond and warranty scheme provided by the association. The website also stated that a stakeholder facility was offered in order to safeguard members’ customers in the event of disputes. In addition to the material presented on the website, an information pack was available which provided details of members and incorporated a pre-contract checklist for customers to follow.

The claimants claimed that they had acted in reliance on the information presented on the website. What the website did not tell them (which the information pack would have) was that their chosen contractor was not a full member of the association, thus meaning that they would not benefit from the protection offered by the association to its members’ customers. Notwithstanding their failure to order the information pack or make any other form of independent enquiry, the claimants claimed that the information on the website constituted negligent misstatements.

Despite the fact that the internet is a big place, it is important to be aware that a website’s audience will generally not be the world at large. A website will generally be marketing specific goods and/or services to a specific target market. This fact in itself will point favourably towards the assumption of reliance and, thus, the existence of a duty of care.

In determining whether or not a website has assumed responsibility for the information they provide, the situation will be examined objectively (whilst keeping in mind the context). It will be considered whether or not there is sufficient proximity between the parties and whether or not it is fair, just and reasonable to impose a duty of care. It will be important to consider whether or not the website is aware of the nature of the transaction that the visitor (or customer) will have in mind; that is to say – how they will use the information communicated to them and whether they will rely on it without independent enquiry. It is crucial to note that any assumption of reliance on the part of the visitor will be subject always to the existence and provisions of a disclaimer.

The website in question did not have a disclaimer. Notwithstanding this, it was recommended that customers consult the information pack prior to entering into any agreements with contractors. In this case, that fact saved the day for the association.

A website should be viewed as a whole. Little or no protection will be granted to the visitor who only reads the introductory paragraph on the homepage. Visitors will generally be expected to read everything that is available. Notwithstanding this however, a prominent disclaimer is always to be recommended.

In this case, the majority of the Court of Appeal found in favour of the association, and the claimants were unsuccessful in their appeal. Despite this however, a dissenting judgment was given which should, at the very least, give grounds for caution. This judgment suggested that there was sufficient proximity between the site and its visitors. It was also suggested that the way in which the information was presented on the website itself did not indicate that the information pack was at all essential.

Although the dissenting judgment does not reflect the final outcome of the case, it should be seen as a warning. If you provide information on your website which you think might be relied upon, exercise caution and have a well-placed, well-worded disclaimer.

It’s all in the Disclaimer

In a world where “Google” has become a verb, the value of the internet as an information resource cannot be over-emphasised. Your first instinct may be to state and rely on the perfectly well founded belief that the information on your website is 100% accurate, always up-to-date and can be relied upon by anyone when making any kind of decision. Having suitable disclaimers however is common and sensible practice. Simply-docs has one, the government’s Business Link website has one and the websites of even the most prestigious law firms have them.

Nobody in their right mind should make an important decision based on only one source of information. In many cases, therefore, website disclaimers are not telling visitors anything they did not already know. For the small minority of users for whom further enquiry is not a matter of course, a disclaimer acts as either a useful reminder or, in the worst case, protects the owner of the website in the event of a claim arising out of a visitor whose sole reliance on the information provided by that website has landed them in hot water.

New Documents from Simply-Docs

Simply-Docs has created a set of website disclaimers for use with a variety of websites. Many of these disclaimers are based upon those found in our existing Website Terms & Conditions, with new versions drafted for use on humour / satire websites and an all-important earnings disclaimer for use on websites offering products or services designed to enhance the earnings, profitability or similar of clients’ own services or businesses.

Don’t delay – get your website disclaimers up-to-date today!

The contents of this Newsletter are for reference purposes only and do not constitute legal advice. Independent legal advice should be sought in relation to any specific legal matter.

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