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What's hiding in the Ts and Cs?

Posted on 12 Feb 2009 at 12:01

Davey Winder finds out what you really let yourself in for when you click "I agree" during software installations.

Click here to read our top 10 stupid EULAs

Last year, the National Consumer Council produced a report called "Whose licence is it anyway?", which called for action against companies that mislead consumers into signing away their legal rights. Of the 25 products it bought for research, only four had a URL pointing to a copy of the End User Licence Agreement (EULA) that could be read before opening the box, while just six had a paper copy that could be read before breaking the seal on the software disc envelope itself. Seven of them left the user with no choice but to read the EULA onscreen as part of the installation process.

The NCC concluded that there was a "significant imbalance between the rights of the consumer and the rights of the holder", and reported 17 companies - including Adobe, Microsoft and Apple - to the Office of Fair Trading under the Unfair Terms and Conditions of Contract law.

With publishers slipping draconian and sometimes even downright bizarre terms and conditions into their EULAs, and consumers often agreeing to that contract without even reading it, we decided it was time to ask software publishers and lawyers some difficult questions, and reveal just what rights you have with the software you've purchased.

Who reads the EULA?

Even the Federation Against Software Theft (FAST) admits that only 28% of people read the Ts and Cs before installing software, while the rest routinely click the "I Agree" button without giving the EULA a second glance. It's precisely this lack of interest that can be used to the advantage of the software publisher. Take the example of the GAIN Publishing "eWallet" product, which was accompanied by a 2,550-word EULA. If people had read only the first paragraph of the seven A4 pages of legalese, they'd have found the software was free of charge "in exchange for your agreement to also install GAIN AdServer software (GAIN), which will display Pop-Up, Pop-Under, and other types of ads on your computer based on the information we collect as stated in this Privacy Statement". Later clauses revealed you were agreeing to let the company collect information about your web-surfing habits and computer usage as well.

Challenge that in court and you're likely to fail, because once you click "agree" that's precisely what you're doing, as long as the EULA is reasonably clear and doesn't attempt to hide its intent. When we asked FAST about the fairness of EULAs, we received a response from Jonathan Cornthwaite and Moninther Sarai of the Wedlake Bell law firm. They pointed out that when it comes to the legality of EULAs you need to look at relevant consumer protection legislation, such as the Unfair Terms in Consumer Contracts Regulations 1999. This introduced a general concept of fairness into UK law to protect consumers, and applies to "any term in a contract between a seller or supplier and a consumer which has not been individually negotiated". This legislation states that an unfair term isn't binding on the consumer, and imposes a duty on the supplier to ensure that written terms are "expressed in plain and intelligible language".

Plain talking

And there lies the rub: just what is determined to be plain and intelligible is up for considerable debate. Graham Arthur, antipiracy attorney with Microsoft UK, insists that Microsoft is constantly trying to ensure that its EULAs are "easy to understand" and "as clear as possible with regards to end users' rights". He admits that because these agreements serve a specific legal purpose there are "inevitably details that are couched in legal language", but argues this is intended to be precise rather than obscure. Indeed, Microsoft positions itself as one of the good guys, with Arthur pointing towards the blog written by its licensing escalation manager, Emma Healey, as proof. Here, you can find an informal forum answering questions about licensing issues. But surely the fact that Microsoft needs, as Arthur puts it, to "demystify some of the complexities behind the legal terminology" suggests that EULAs aren't clear enough in the first place?