How Not to Incorporate a Virtual Attachment, Part Deux

In this March 2007 post I discussed language to use, and language not to use, when making an ancillary document—including a web page—part of a contract without physically attaching it. (I subsequently invented the term “virtual attachment” to describe any such ancillary document.)

What prompted that post was a case that held that saying that the contract at issue was “subject to” a virtual attachment was inadequate to make that virtual attachment part of the contract. I suggested that your best bet is simply to say that the virtual attachment constitutes part of the contract.

If you’re a fan of cases dealing with deficient ways to make virtual attachments part of a agreement, here’s another, courtesy of Eric Goldman.

In Manasher v. NECC Telecom, No. 06-cv-10749 (E.D. Mich. Sept. 18, 2007), the issue was whether the contract between the plaintiffs and the defendant telecommunications company included an arbitration clause.

When the defendants first became customers, the plaintiff sent them an invoice containing five provisions. Here’s what the fifth provision said:

Agreement (Disclosure and Liabilities)

NECC’s Agreement “Disclosure and Liabilities” can be found online at www.necc.us or you could request a copy by calling us at 800) 766 2642.

That separate disclosure-and-liabilities agreement included an arbitration provision, but the court held that it was unenforceable:

The Court finds that the fifth statement on the second page of Plaintiffs’ invoice, entitled “Agreement (Disclosure and Liabilities),” is insufficient to incorporate by reference the separate Disclosure and Liabilities Agreement found on Defendant’s website. The language does not betray a clear intent that the Disclosure and Liabilities Agreement be considered part of the contract between the parties. … Nothing in the statement clearly indicates that the Disclosure and Liabilities Agreement applies to the service contract between the parties, that it forms any part of the agreement between the parties, or that it is intended to be incorporated into the agreement between the parties. The statement merely informs the reader of where to find “NECC’s Agreement ‘Disclosure and Liabilities.'” Further, the statement is the last of five statements, written in plain text, on the second page of the invoice. There are no allegations of any other references to the Disclosure and Liabilities Agreement either in writing, or in the verbal dealings with Defendant. Thus, the Disclosure and Liabilities Agreement is not incorporated by reference, and accordingly, the arbitration provision contained therein is unenforceable.

So if you want to incorporate a virtual attachment, don’t say how it “can be found” or “is available at” at a given URL.

But wait! There are other less-than-clear ways to make a virtual attachment part of a contract. Reader Mike Wokasch of Quarles & Brady, long a source of great leads, tells me that just today he saw the following provision in a draft he was reviewing:

“Support Services” means Product support services described in the Description of Support Services provided at the [Redacted] Licenses web site (http://www.[redacted].com/licenses), as may be updated from time to time by Licensor.

I agree with Mike that that’s a wishy-washy way of making a virtual attachment part of an agreement. Mike revised the contract to physically attach the “Description of Support Services.” (He also eliminated the licensor’s right to unilaterally amend those terms. But that’s another topic.)