back to article FSA: Of course customers don't read contracts

Companies should not reject customer complaints because they ticked a box saying they had read and understood an unfair contract, the Financial Services Authority (FSA) has said. The FSA said that companies should not even ask consumers to assert that they had read and understood a contract or a set of terms and conditions …


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  1. Pascal Monett Silver badge

    Nice to see

    It's nice that lawyers are finally trying to do something about those click-through licenses.

    Maybe somebody will next point out the most obvious failing of the EULA : the company can change it without consent from the customer.

    I'd like to see where they will go with that issue.

  2. Anonymous Coward
    Thumb Down

    You got the Acronym wrong, surely...

    It should be the SFA.

    Not a brain cell to rub between them. There are some criminally obvious solutions to the financial crisis, and they're just making cuts.

    What they need is a little blue sky thinking, rather than hundreds of people protecting their arses.

  3. loopy lou
    Thumb Up

    Something sensible from the FSA!

    Lets hope its the beginning of the end for this ridiculous "agree to something you can't be bothered to read before you continue" when you visit some trivial website. Why does every site have to draft its own terms anyway? Couldn't they all use the same ones? Then the user might actually stand a chance of knowing that they are happy with "standard terms A" but won't agree to "standard terms B" or something.

    If a site that insists on you agreeing to five pages of its own legal garbage was actually forced to make sure you'd read it before you continued, then they'd rapidly decide it wasn't worth it and settle for "standard terms A" or something so they'd actually get some users.

  4. The Original Ash
    Thumb Up

    A step closer...

    Let's get this out of the way first: If you don't understand it, don't agree to it. It's your own fault if you're too stupid to realise you're signing your life away on the dotted line.

    Unfortunately, 4 pages of 8-point writing written in outrageously convoluted and extremely technical legal language is beyond the comprehension of almost everybody outside of a legal profession. I mean, check's T's and C's. They have a 16-line paragraph for their DISCLAIMER OF WARRANTY (ALL IN CAPITALS, MAY I ADD, AS IT'S VERY IMPORTANT!!!). *I* know it means, in brief, "If a game hoses your system, it's your fault." but surely that's exactly one of the terms which would be contested? Yet to whom do you ask the question? "If this game you host breaks my computer, why are you not liable? You host the content, you encourage me to click the link and play the game, you make money from the advertising on the page with the game... You're essentially a merchant selling a faulty product." says the layman, yet where does he find if that's accurate without retaining a solicitor?

    TL;DR: I approve of this.

  5. Ian Chard
    Thumb Up


    should take heed; last time I was asked to assent to modified T&Cs on my iPhone, it said 'page 1 of 90'.

  6. Barry Tabrah

    Solution 2

    Add another check box that says "I couldn't be bothered to read the Terms and Conditions and wish to continue anyway. When I later disagree with your Terms and Conditions I understand that my only recourse is to voice my objection on the social network of my choice."

    Problem solved.

  7. cs94njw

    It was looking so good...


    "The FSA said that, like The On-Line Partnership's new term, agreements should warn customers that they should consult with a company about anything in an agreement that they do not understand."

    Muppets. It's 11:30pm at night, you need car insurance for the following day. A tricky T&C comes up... oh I'll just give them a ring... oh... er... I'll send them an email, surely they'll reply within 30mins....

    So no change here. In the first place, people didn't want to read pages of T&Cs and couldn't understand them anyway. Now the user's are expected to contact companies (which have tended to degrade customer services) for any T&C they don't understand.

    Ah well.. FSA's getting disolved anyway.

  8. Aitor 1 Silver badge

    Abusive contract terms/parts

    The problem with these contracts is that it is, mostly, a one sided thing: consumers

    have o say in it, it is either take it or leave it.

    Spanish law is clear about this: if the contract is the same for most clients or is pre-written

    and the consumer has no say in it, it is called an "adhesion" contract: you can therefore "sign"

    it but you are bound only to the non abusive terms of such contract.

    The abusive terms have to be declared abusive by a judge, but if one term from a contract is declared abusive,

    all equivalente terms are automatically considered abusive.

    This is only applicable to consumers, not relationships between companies, and I really think all countries should

    have an equivalent law.

    1. beerandbiscuits

      Just the same as here then

      The Unfair Terms in Consumer Contracts Regs 1999 say pretty much the same thing, as did the 1994 regs that preceded them. The reason being of course, that Spain adopted the same rules as the rest of the EU, when they were told they had to by Directive 93/13.

  9. Ancient Oracle funkie
    Paris Hilton

    Sorry ...

    ... I read this post but didn't understand it.

    Where do I tick?

    Paris - Because I'd love to tick her box!

  10. Anonymous Coward
    Anonymous Coward


    ...took a double-glazing co. to small claims court some years back. I'd told the salesman I wasn't going to pay on completion unless the job was satisfactory and he said to pen that onto the contract, so I did. They did a poor job but someone who shall remain nameless gave them the first (large) payment anyway. In Court they argued that I'd signed the contract (which in the small print said something to the effect that anything added to it was invalid). The reason I didn't read all the small print was because as I told the adjudicator: I take the position that if I'm lied to to get me to sign a contract, I don't consider the contract valid. Whether it helps to put it bluntly as opposed to in legalese, I don't know, but I had fun watching the fuckers squirm, and we won. I think it's where I got the taste for telling companies and their legal teams to take a flying leap. Everyone should try it.

  11. Rogerborg

    Well, that's that sorted then

    Now that the FSA have said that companies "should" effectively tear up their T&Cs, I'm sure they'll all fall over themselves to be the first to do so.

    1. Maty

      In legalese

      'There was no meeting of minds'. For a contract to be valid, both parties have to be agreeing on the same thing. If I think I'm selling you a donkey and you think you are buying a horse, there is no meeting of minds, and therefore no contract. Or at least this is my non-lawyer's understanding of it.

      So if you can prove to a court that the other party deliberately concealed or misrepresented information which you should have known when entering into the contract, then there is no contract.

    2. peter 45

      Small guy sometimes wins

      Congrats. Also had my own small victory. I wanted to rent a house and I insisted reading all the renting agency small print. I found a clause that basically said that all disputes had to go to abtritation, all abitration costs and lawyer fees were on me whether I won or lost, and they appointed the arbitrator. I just waited till they were distracted and crossed out the clause and initialed it and they signed it without reading it.

      6 months later they witheld the whole deposit for spurous reasons, so I threatened them with small claims court. They reminded me that there was an arbitration clause, and I reminded them that there wasn't. (The memory of the smug look on the guys face collapsing as he saw the altered contract still brightens my day). Arguments erupted, legal threats were made but I got every penny back.

      I later found out that they kept all deposits from every rental. They were relying on the fact that no-one read contracts to shaft every customer sideways because the arbitration costs were uncapped would vastly outweigh the deposit. Customers just walked away and chalked it up to experience and the rental agent pocketed £thousands. Happy to report that their acitivities were reported to the local Press and Trading Standards and they soon went out of business.

  12. Anonymous Coward
    Anonymous Coward

    This makes sense

    A few things:

    1. My wife is a lawyer and she frequently ticks the "I agree" box without reading the T&Cs. She says it would cost hundreds of pounds for her to read the T&Cs as a lawyer and she's protected by consumer rights anyway. If a lawyer won't read the crap, why should I?

    2. While in the UK buying a railway ticket online for travel abroad I was asked to agree to some terms that weren't even shown to me: they there available for inspection at any Belgian railway station, apparently. Presumably in the local language. I agreed to them, trusting the consumer protection laws. I'm glad I live in a country that has consumer protection laws.

    3. I'm also very glad we have laws that limit what is enforceable in a contract of employment. I'm glad I don't live in the USA, for example.

    4. One of most fantastic examples I ever came across of stupid T&Cs I read about here in The Register. One of the phone companies had a competition to submit suggestions for an application with some crappy cheap prizes and the terms for entering the competition included indemnifying the phone company against any patent infringement by the punter's ideas. How much would insurance for that cost, do you think?

  13. Anonymous Coward
    Anonymous Coward

    common sense

    no one is going to read 100 pages of complex largely meaningless legalese in long abstract sentences in a document that begins with an entire page of definitions where "'you' means 'you' except when 'us' means 'them', if 'you' are taller than 'us' and 'us' are taller than 'them', is 'them' taller than 'Jane' - given that it is Jane's birthday next week (as described in subsection B, 'you')?" and it's like wtf I just want to buy socks.

  14. Anonymous Coward

    Must be nice not having any thick customers

    While I recognise that these T&Cs often hide some abusive stuff, they can also provide a bulwark against the sheer rampaging cretinism of many consumers. For example, my shop runs guided *outdoor* walking tours and it's always amazed me how people can expect to get a refund 10 minutes before the tour starts ... because it's raining. What, did you think we'd be jacking in the whole tour and turning away the other 40 people who *did* bring coats because of this? (Sidenote: rain is not uncommon in the land in which we operate, even in summer.)

    Sorry, but if you can't provide (a) a few hours' grace to attempt to re-sell your tickets or (b) a half-decent reason why you can't attend, we're keeping your damn money and we'd really rather you understood that before you buy, because me shouting "FUCKWIT!" at you through a rolled-up newspaper may offend.

    This sort of thing is all there actually is in our T&Cs -- busting bizarrely common misconceptions -- and we *beg* people to read them before they even get near parting with their hard-earned. But of course they still don't.

    I'm conscious of how Tory I sound right now and fully expect to be downvoted, but the culture whereby businesses aren't allowed to presuppose even a modicum of common sense on the part of their clientele really scares me at times.

  15. Britt Johnston

    a way to easy

    might be to set up GCSE syllabus in internet contracts, and get the examiners to do the dumbing down.

    Icon chosen since the picture fits, just ignore the descriptive details...

    1. Anonymous Coward
      Anonymous Coward

      Thats not what this is about

      Its about unfair T&Cs. If yours are well clear and fair then no problem.

      To be honest I don't understand why we even need all these T&Cs, as everything should be governd under the same laws as selling stuff in a shop, with the addition of a few distance selling laws, which are there anyway.

  16. heyrick Silver badge

    One small point

    We've all done it. The licence terms can be horribly controrted, lengthy, trivial, with big sections in difficult to read CAPITALS, and lots of irrelevant (in the EU) mutter about patents. And, frankly, who gives a damn about the jurisdiction of the state of Massachusetts - that bit probably won't fly over here any way.

    But, all the same, we tick a little thing saying "I agree to this crap". Usually without reading any of it. Which is, you know, LYING.

    1. Charles 9 Silver badge

      Then how about a directive...

      ...that any type of adhesion contract should be in simple language proven comprehensible to a person of suitable intelligence (say an IQ of at least 90) within a reasonable amount of time (say, 2 minutes for most basic T&Cs). IOW, couching contracts in "legalese" might be considered an illegal obfuscation, an attempt to get the party to accept terms they cannot comprehend.

      1. TimeMaster T


        Don't you think 90 is a bit high?

        no joke icon because I'm not.

  17. Anonymous Coward
    Anonymous Coward

    A slightly different perspective

    I used to work as customer service for a telecoms provider. We once had a customer place an order online for the installation of a new phone line to his house. The line was installed and shortly after we sent the invoice for the installation and first months line rental.

    He then phoned up and angrily complained that we had not informed him of the £98 installation charge, despite the fact that several places on the site stated this in bold letters. He also ticked the box stating that he 'Was aware of and agreed to the stated charges'. He argued that he did not actually read what the charges were so was not bound by out terms and conditions despite ticking the box, confirming the details in the automated confirmation email we sent him, and completing and signing a direct debit form and returning it to us.

    He demanded a credit for the installation charge as well as compensation for 'deceiving him' and his wasted time in sorting it out. All of this was snarled at me in the most condescending and self-righteous tone I have ever heard (and i've more than 7 years experience dealing with customers ). It ended up taking a 2 hour conference call involving myself, my team leader and our general manager to get him to agree to pay 50% of the installation charge. Tosser.

  18. Harry

    "Why does every site have to draft its own terms anyway?"

    Precisely. Contracts between companies and the public, and even between companies and small businesses, should be subject only to one contract term -- the law. Any term that attempts to give the seller any additional right should be, by definition, an unfair contract term -- and therefore, any term which attempts to take away a right from the buyer rather than to give an extra right ought to be a criminal offence in its own right.

    Consequently, by far the best law would be one that prohibits contract terms altogether.

    1. Richard Gadsden

      "Meeting of minds"

      My view of the meeting of minds is that a contract should be a legal expression on a piece of paper of the results of a conversation and agreement between two human beings. If the transaction isn't complicated enough for that, then don't bother with a contract in the first place.

  19. This post has been deleted by a moderator

  20. Andrew Findlay

    Timed Out

    On most e-commerce sites that I have used, if you actually stop to read the Tc&Cs the site will time out and throw away your transaction. This says to me that the site owners do not actually expect people to read the legalese, and that nobody did so during the usability test.

    Old Scots law had an interesting approach to contracts: to be valid they had to be handwritten *by the person accepting the contract*. This put a real limit on the length... Eventually they gave in to the idea of printed contracts, and required people to write "accepted as holograph" in lieu of copying the whole thing out longhand.

    The real answer is for the courts to always find in favour of the (reasonable) consumer if the time taken to read and understand the terms is out of proportion to the transaction. In most cases this would limit the text to thee very short and clear paragraphs.

    1. This post has been deleted by its author

  21. Anonymous Coward
    Anonymous Coward

    Couldn't agree more, but...

    "The real answer is for the courts to always find in favour of the (reasonable) consumer..."

    Right enough - but the problem is in getting to court. Last time I investigated legal action against a major firm it became clear very quickly that, while a court action might threaten that firm's petty cash situation, it could leave me in hock for the rest of my life. Until hiring a lawyer for more than 10 minutes doesn't involve a second mortgage, all of this remains kind of moot to many people.

  22. Jim Nagel

    What a pane

    I'm surprised nobody yet has had a rant about those aggravating credit-card-sized scrolling panes that they expect you to read their T&Cs in. No wonder we all just tick their box. Surely that's their plan.

  23. Disgruntled of TW

    Software warranty anyone?

    My latest iTunes update came with a hefty 98 pages of 8pt PDF. Rather than stay with redundant versions, I ticked and loaded, trusting that the flock of users before me would assist in the class action that may follow when Apple fall.

    The entire software, security and "fit for purpose" argument would be moot were software creators once again confident enough to offer a warranty with their wares. The entire software industry needs to revisit this, before software producers will be motivated to consider security concurrently with profit, which would remove the need for the disclaimers that currently prevail. Apparently, no software produced since the early 70's is fit for purpose. It all started then.

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