The inclusion of terms and conditions in online transactions

Traditionally, contracts were formed where parties met and exchanged signed documents containing the terms of the agreement.

With the spread of e-commerce, many contracts are now paperless and are accepted and completed with the click of a mouse.

The recent case of Gonzalez v Agoda Company Pte Ltd [2017] NSWSC 1133 illustrates that online contracts have the same legal effect as contracts which are formed by exchange of formal contracts.

The facts

Agoda Pte Ltd (Agoda) is a Singaporean-based company offering online booking services for accommodation worldwide.

Ms Gonzalez booked accommodation in Paris from her computer at her home in Sydney through Agoda’s booking portal.

Agoda’s ‘standard terms and conditions’ were contained via a separate link to the ‘payment details page’. The words, ‘I agree with the booking conditions and general terms by booking this room…’ appeared on the ‘payment details page’ above the ‘book now’ tab. Ms Gonzalez however was not required to ‘visit’ the ‘standard terms and conditions’ page nor check a box confirming her agreement to those conditions, before proceeding with the booking.

The standard terms and conditions contained an exclusive jurisdiction clause which meant that the law of Singapore would apply and that the Courts of Singapore were to determine any disputes between the parties.

Ms Gonzalez suffered injury when she slipped and fell in the bathroom of the hotel during her stay. She commenced proceedings in the Supreme Court of New South Wales suing Agoda under Australian consumer laws, claiming damages and breach of contract.

Agoda argued that an Australian Court should not preside over the case in light of the exclusive jurisdiction clause.

Ms Gonzalez claimed that the exclusive jurisdiction clause did not form part of the contract because:

·   she was not required to positively ‘tick a box’ accepting those terms;

·   she was not given reasonable notice as Agoda had not sufficiently brought the terms and conditions to her attention.


The Court determined that the contract did in fact contain an exclusive jurisdiction clause and it was ‘very probable’ that the clause formed part of the contract. The booking terms were not concealed and were, due to their location and ability to be readily accessed, available to Ms Gonzalez. Ms Gonzales accepted the terms by clicking the ‘book now’ tab.


Ecommerce businesses must set up their online platform in such a way that it is easy to demonstrate that the customer has received the terms of an agreement and intends to be legally bound by those terms. There are generally two ways in which this is achieved:

·   Click wrap method – involves the user selecting the desired product or service then, to proceed further, ‘checking’ acceptance of the terms and conditions which appear on the same page. The user must scroll through the terms and affirm agreement by pressing the ‘I agree’ or ‘I accept’ tab. The positive action of clicking on the acceptance tab is generally considered adequate to prove agreement to the contractual terms.

·   Browse wrap method –the terms and conditions are contained on a separate page, usually via a link (as was the case in the Agoda). The user is not required to read (or go to) the terms and conditions before proceeding and may choose to ignore them. Depending on the circumstances, this may be less effective as the ‘notice’ requirement is more difficult to prove.