ContractsProf Blog

Editor: Jeremy Telman
Oklahoma City University
School of Law

Saturday, May 24, 2014

Mutuality and Wrap Contracts

As I've noted in a prior post, there is a lawsuit pending against Google for email scanning which was recently denied class status.  Something that's puzzled me about wrap contracts generally, including Google's, is that many of them don't seem to be contracts at all - and not simply because of the (lack of) consent issue.  They typically contain modification at will clauses and termination at will clauses.  In contracts class, I teach students that generally (with the exception of employment contracts) these clauses lack mutuality unless constrained in other ways, such as a notice period.  While there may be consideration (use of service in exchange  eyeballs?  not clear), there is no consideration if the promises are illusory and don't actually bind a party.   Google's terms of use, for example, state:

"You can stop using our Services at any time, although we’ll be sorry to see you go. Google may also stop providing Services to you, or add or create new limits to our Services at any time."

and this unilateral modification clause:

"We may modify these terms or any additional terms that apply to a Service to, for example, reflect changes to the law or changes to our Services. You should look at the terms regularly. We’ll post notice of modifications to these terms on this page. We’ll post notice of modified additional terms in the applicable Service. Changes will not apply retroactively and will become effective no sooner than fourteen days after they are posted. However, changes addressing new functions for a Service or changes made for legal reasons will be effective immediately. If you do not agree to the modified terms for a Service, you should discontinue your use of that Service."

Google then isn't bound to actually provide anything according to its Terms of Use. 

In the email scanning case, Google is making the argument that consent to email scanning was obtained in the context of "consenting" to the Terms of Use.  But if these "contracts" are not really contracts because they lack mutuality, then can Google really claim that their users "consented" to the email scanning?  Is there blanket assent to terms outside of the context of a contract? 

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Think of the terms of service as (part of) a published standing offer to perform a service -- a Web search, let's say. Each time a user types in a search request and hits "Enter," that action constitutes acceptance of the offer; as a result, a new, =unilateral= contract is formed to govern that specific search request. Under the terms of service, Google can't unilaterally change the terms retroactively, so there's no mutuality problem as to any specific search request.

(Twice now this Web page has wiped out what I'd typed before I had a chance to post it; I hope it hasn't been posted multiple times, but if so, THIS one is the "final" version.)

Posted by: D. C. Toedt | May 25, 2014 6:57:01 AM

Thanks for the comment. This makes sense if you are talking about search but it doesn’t make sense if you are talking about ongoing services (Gmail or Google+ ). When you log off the site, your content is still being hosted by the site. The “transaction” isn’t completed and it’s not structured like a one-time deal (like a search is). I also don’t think this is the argument that Google is making.

And my comments have also disappeared several times when I tried to post! Something is very annoying about the Post Comments function on this site.

Posted by: Nancy Kim | May 27, 2014 2:09:29 PM