Question

Bill went to the Acme Widget Co. website to buy a quantity of widgets. To complete the purchase he had to click on “I agree” where Acme said that users must read and agree to their terms. He did not read the agreement, however, so he did not know that it provided for mandatory arbitration, in California, pursuant to California law, of any dispute regarding any aspect of the transaction. He sought to sue Acme in a Texas court, asserting a defective product claim under section 402A of the Restatement of Torts. Acme asserted the agreement as grounds for dismissing the suit and transferring it to an arbitrator in California. Bill argued that he should not be bound by complex provisions written in legalese that he did not have reason to understand at the time of purchase. If, as I maintain, the outcome should be the opposite of that reached in the Specht case excerpt in chapter 12, Bill (a) should or (b) should not be bound by the arbitration provision.

Answer 1

Ideally it is the duty of the signor to read the agreement and seek explanation before signing the contract. In this case Bill should have understood the contract and conditions before signing it. However, since he has not, he should be bound by the arbitration provision.

However, if he can prove that the legalese language was unreasonably complicated for normal reader, he can prove that Acme Widget Co should have explained the terms to him. In that case he can prove a lack of duty from the side of Acme and not be bound by the arbitration clause.