Benoliel & Becher Paper on the Unreadability of Web Site Sign-In Wrap Contracts

Uri Benoliel of the College of Law and Business – Ramat Gan Law School and Shmuel I. Becher of the Victoria University of Wellington have written The Duty to Read the Unreadable. Here's the abstract:

The duty to read doctrine is a well-recognized building block of U.S. contract law. Under this doctrine, contracting parties are held responsible for the written terms of their contract, whether or not they actually read them. The application of duty to read is especially interesting in the context of consumer contracts, which consumers generally do not read. 

Under U.S. law, courts routinely impose this doctrine on consumers. However, the application of this doctrine to consumer contracts is one-sided. While consumers are excepted to read their contracts, suppliers are generally not required to offer readable contracts. This asymmetry creates a serious public policy challenge. Put simply, consumers might be expected to read contracts that are, in fact, rather unreadable. This, in turn, undermines market efficiency and raises fairness concerns. 

Numerous scholars have suggested that consumer contracts are indeed written in a way that dissuades consumers from reading them. This Article aims to empirically test whether this concern is justified. The Article focuses on the readability of an important and prevalent type of consumer agreements: the sign-in-wrap contract. Such contracts, which have already been the focal point of many legal battles, are routinely accepted by consumers when signing up for popular websites such as Facebook, Amazon, Uber, and Airbnb. 

The Article applies well-established linguistic readability tests to the 500 most popular websites in the U.S. that use sign-in-wrap agreements. We find, among other things, that effectively reading these agreements requires, on average, more than 14.5 years of education. This result is troubling, given that the majority of U.S. adults read at an 8th-grade level. These empirical findings hence have significant implications for the design of consumer contract law.

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