Challenges of E Commerce to Traditional Contracts

Challenges of E Commerce to Traditional Contracts Disclaimer: This work has been submitted by a student. This is not an example of the work produced by our Law Essay Writing Service . You can view samples of our professional work here . Challenges of E Commerce to Traditional Contracts As Information Communication Technologies progresses so do new media technologies such as the internet. Many individuals and businesses have moved towards such means as an opportunity for expansion in commerce.   [ 1 ]   This new path of business has been referred to as E-Commerce. It is defined as any business transaction that has been negotiated over an online system and where the parties interact electronically rather than by physical exchange or contact.   [ 2 ]   Due to this ICT revolution, information held by businesses can now be accessed by a wider group of people due to the availability of the internet. The principles of Contract law that governs online transactions continues to progress as businesses that are based online change and grow. Agreements can be as simple as clicking on a box to agree to purchase terms, or complex contracts covering intellectual property or consumer privacy.   [ 3 ]   As it continues to grow, e-commerce maintains its roots in traditional contract law however, as a result of the old and new complexity there are some challenges that e-commerce poses to the traditional model such as issues regarding offer and acceptance, jurisprudence and globilisation, state of mind and enforceability of electronic contracts as opposed to the traditional model of contract. OFFER AND ACCEPTANCE The basic concept of effective communication in contract formation is the concept of offer and acceptance.   [ 4 ]   E-commerce poses a major problem in relation to this issue. It is important to identify the offer and acceptance because they fix the precise time and place of the agreement, thus determining which jurisdiction is relevant.   [ 5 ]    Often in e-commerce transactions between parties never meet each other face to face. This is an immediate issue and challenge to the traditional form of contract as it makes it difficult to ensure the parties act lawfully and that the tra nsaction itself is legal and has undergone the steps necessary to regard it a contract.   [ 6 ]   When speaking of bilateral contracts, an offer is a clear statement of the terms in which a person (the offeror) promises to be bound and the other party (offeree) accepts the offer and it is through acceptance of this offer that a contract is created.   [ 7 ]   On the internet, it is difficult to determine whether a webpage is considered an offer or an invitation to treat. However, The Electronic Transaction Act however, in s14 states that a message is deemed sent under s14(1) when it ‘enters a single information system outside the control of the originator’ thus is deemed sent.   [ 8 ]    The words used in an online offer can often be considered misleading, and different legal systems may have different approaches to these problems. An acceptance is a final unqualified agreement to the terms of the offer.   [ 9 ]   Generally, it must be communicated to the offeror and the parties are free to vary by agreement.   [ 10 ]   E-mail is a common method of acceptance in ecommerce environment. Acceptance of an offer becomes effective at the moment the indication of assent by the offeree reaches the offeror.   [ 11 ]   Whilst E-mail is a common method of acceptance in the e-commerce it proves to be problematic. The ‘Postal Acceptance Rule’ states that when parties have agreed to transact a deal by post, the contract is deemed concluded when the letter of acceptance to the offeror is posted by the offere whether the offeree gets it or not. This rule does not apply to e-commerce. The Electronic Transactions Act 1999 (Cth) deems a message received under s14(3) when ‘the electronic communication enters [the addressee’s] information system’   [ 12 ]