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All About Common Internet and Technology Contract in India

All About Common Internet and Technology Contract in India

The internet has revolutionized people’s way of communicating. In addition, the way people are doing business has also changed the internet and electronic data exchange. It created a new kind of trade and trade called e-commerce. E-commerce is booming with a high level of internet penetration worldwide and the rise of internet users. High speed and a geographic absence have contributed greatly to the growth of e-commerce,  which is the key advantage of the internet. 

For instance,  a buyer in India can buy goods from a vendor in the United States with just a few clicks of the mouse, without having to leave their home or office. In an electronic world called electronic contract or simply e-contract or online contacts, e-commerce brought about a new form of contracting.  Electronic contracts are commonly known to many of us. The most common contracts are “End User License Agreement” or the EULA where the installation of software or terms/conditions/   User agreement on the Website requires a click on the “ I agree” button.

Common internet and technology contracts

Online contracts can be of three types as underneath :

1. Shrink-wrap agreements

Shrink wrap contracts are usually a licensing agreement for software purchases. In the case of shrink-wrap agreements, the terms and conditions for access to such to such software products shall be enforced by the person buying it, with the initiation of the packaging of the software product. Tightening-up agreements are simply the agreements that are accepted by users, for instance,  Nokia pc-suite, at time of installing the software on a CD-ROM. Sometimes,  after loading the product onto your computer,  additional conditions may only be observed and then, if the buyer disagrees,  he has an opportunity to return the software product .

2. Click or web- wrap agreements

Click wrap contracts are  web-based contracts  that require the user’s consent  or consent through the “I Accept” ,or  “OK” button. The user must accept the terms of use of the particular software with the click wrap agreements. Users who disagree with the terms and conditions  cannot use or purchase the product after cancellation or refusal. Someone almost regularly observes web-wrap agreements. The terms of use shall be set down before acceptance by the users. For instance,  online shopping etc.

3. Browse-wrap agreements

A browsing wrap agreement can be called an agreement which is to be binding on two or more parties through the use of the website.  In case of an agreement on browsing, an ordinary user of a given website is to accept the terms and conditions of use and other website policies for continuous use. We usually witness such kinds of online contracts in our daily lives.

4. Other online contracts

Other online contracts are

  • Contract for employment ,
  • Contractors,
  • Contracts for consultants,
  • Sales and resale agreements ,
  • Distributors,
  • Non-disclosure agreements,
  • Software developer and
  • Licensing agreements,
  • Contracts for source code escrow.

Formation of online contracts or electronic contracts

Like an ordinary contract, e-contracts consisting of an offer and acceptance are enforceable. The conduct of the parties, such as exchanging e-mails or acceptance of a condition or terms or by downloading can also imply a contract. A variety of procedures are available for forming electronic/online  contracts:

Email: The parties may create a valid  contract by exchanging e-mail communications. Offers or acceptances can be completely exchange via e-mail, or combine with paper documents, faxes and oral debates.

Website forms: In many cases, an e-commerce website offers for sale goods or services that are ordered by customers , by filling on and submitting an on-screen order form. The seller  will enter into a contract once the order has been accepted. The products and services  can be delivered off-line physically. A contract would also  be valid for the terms of use of a website once the user accepts the contract by clicking “ I Agree “.

In summary, an e-contract is very different from a traditional contract : it is paperless and it is sometimes not possible for the parties to meet face to face. Here we try to analyze and examine various aspects of a conventional contracts

COVID19 and online contracts

The growth of human civilization has wItnessed a rise in pandemics as well. And novel coronavirus (COVID-19) is also a pandemic. This cpronaviris sItuation has brought all countries into a crisis handling mode on the immediate healthcare threat. Beyond the obvious health repercussions, this global pandemic has presented major for global businsess. While on one hand where we can see direct commercial impacts on specific sectors,with interruptions to supply chains, challenges In meeting contractual obligations and implications under funding arrangements, other impacts are universal ranging from workplace health and safety obligations, the impact of travel restrictions and containment measures, increased record keeping, protecting sensitive personal data to business continuity planning, businesses throughtout the world are grasping at straws.

Force Majeure and the law of doctrine of Frustration

FORCEMAJEURE

Force majeure clauses allow for parties to get out of certain obligations in the event of  unforeseen or uncontrollable events.

The Indian Contract Act ,1872 -the 148 year old legislation which determines the circumstances in which promises in a contract shall be leglly binding – is silent on the term ” Force Majeure “. Though the Act allows an agreement for performing an ” Impossible” act to be consider void, Court outcome of disputes have varied from case to case, depending on the facts of each.

And, even if the term “Force majeure”or  superior force in latin -is mention in a comtract between two parties, “epidemics” or “pandemics” are rarely, if ever, include in the definition of “force majeure” which typically covers catastrophes like earthquake, flood, and war.

“Invetably, all contracts will be put to litmus test. Very few contracts in India includes pandemic as a force majeure event as such events are never anticipate. This will affect many. Some impact by the lockdown may also be affect as acts of government may not be under the terms  of force majeure. It all depends on terms between the parties.

In cases, where contracts do not have a force majeure clause, Section 56 of Indian Contarct Act,1872  comes into play; it deals with “Frustration of Contract ” – a soyuation where fulfilling a contract becomes impossible or unlawful after the execution of the Contract. Traditionally, Courts have chosen a narrow interpretation of the law in ruling on disputes where Section 56 had kicked in the threshold to invoke the “doctrine of fristration ” is formidably higher than that of force  majeure. It has to pass Judicial tests and proving frustration os more difficult than proving force majeure.

In the cases Of

1.DhruvDevchandvsHarmohinderSinghAIR1968SC1024and

2. SushiladevivsHariSingh (1971) I.S.C.W.R.697

SC has held that the doctrine of frustration can be apply to leases. In lieu of real estate, lease frustrations by a tenant are bind to be reason with regard to coronavirus in India. This is because, during this period,a tenant is unable to occupy and/or  use the premises (which seems the likely scenario at the moment).

Effect or Impact Coronavirus on certain Contracts

A) Construction contracts:-

Coronavirus COVID-19 Is already affecting engineering,fabrication and procurement contracts that contemplate inputs of labour, services,and goods from affected regions.

Many international and domestic construction contracts contain force majeure clauses to give relief in these circumstances. The purpose of a force majeure clause is to avoid the legal and commercial uncertainty of events that would otherwise frustrate the performance of the contract. The operation of the force majeure clause may differ in each case and specific legal advice should be sight.

  • What about contracts negotiated now?

Force majeure clause may not be of benefit to the parties since the existence of coronavirus COVID-19 is already known. A better approach would be to incorporate a provision wherein a specific relief with regard to coronavirus COVID -19 is duly captured, whether this is a disruption to supply chains and labour resources or the result of the government introducing any emergency powers.

The exact relief and provisions therein would depend on the precise nature and location of the project and therefore the legal experts would have to ensure mindful drafting and capturing of the relief.

B) Insurance Contracts

In India the gpvernment has termed coronavirus a “notified diasater ” fulfilling the formal requirments of many insurance policies, it  has provided a ray of hope to those who have business policy cover. They may now be able to claim under it, depending on the specifc terms of their policy.

C) landlord and tenant ‘s contracts

  • Landlord duties amidst legal issues fue to coronavirus
  • Health and safety

Landlords have duties towards tenants and others regarding risks passed from infectious diseases. Landlords may also have responsibilties to the extent that they exercise relevant control over parts of premises ( and their ability to implement measures). Failure to fulfill these Criteria will result in serious consequences- for organisations amd individuals alike.

However,as per the specific health and safety regulations,a landlord is not oblige  to prevent or contain the spread of coronavirus COVOD-19 on ots premises. The hazardous substance  regulations which provide a framework to control the risks from a range of hazardous substance under Pollution Control and Environment Health and Safety Laws may be relevant,as the coronavirus is a  biological agent. Whether such obligations towards tenants exist under the law largely depends on the level of control a landlord has over the property. This will be dictate both by the terms of the.leases grant amd the physical characteristics of the property.

  • Occupier’s liability amidst legal issues due to coronavirus

A lamdlord may be in control of whole or any part of the premise and so he autimatically is liable  to take the requisite measures concerning any person, be it invite/uninvit entering the premise. It is unlikely that any additional liabilities will result from such legislation.

Landlord’s ability to recover costs of enhanced cleaning and regulatory compliance

Commercial landlords responsible for common parts (common area maintenance) are providing more frequent abd thorough cleansing of these common parts, particularly frequemtly touch surfaces (e.g. door Handles, elevator buttons and toilets ), although, there is no legal obligations on them to provide such services to prevent tue spread of the virus. Supplying these extra cleaning services will have cost implications, and commercial landlords should check the service -charge provisions in their lease to ensure such charge are recoverable.

  • Suspension and witholding of rent

In present conditiin there is suspension and witholding of rent make as tenant is unable to pay rent because of conditiin of epidemic in world. And some government also take.preventive step like Delhi Govt. Has taken measures to not collect rent from tenant in such condition of lockdown.

Practical Steps to be taken

For businesses and contracts likely to ne affected by coronavirus COVID-19, following steps could be beneficial:

  • Be up to date with the latest guidelines issued by WHO And the Indian Govt. :
  • Review any obligations in leases, construction contracts and other real estate contracts:
  • Insert epidemic wording into any new real estate contracts :
  • Provide adequate cleaning measures to frequently touched surfaces:
  • Make suitable arrangements for laptops to be takes home on a pre-emptive basis for remote or homeworking for employees:
  • prepare IT systems for potential additional remote -access usage and capacity enhancement.

CONCLUSION

Thus last to conclude we can say that this situation of pandemic will be no longer. And some relief should be give to people suffering from lockdown. And to establish people and economy of our country some restrictions have to be followed. As a great political scholar had said to enjoy more rights you have to follow  minimum restrictions.

And besides affecting several things COVID-19 also affects Contracts. But by applying  a force majeure clause amd

section 56 of Indian contract Act,1872  we can simply  comply with performance of contracts

In this COVID 19 pandemic online contract is the best way to make contracts and do business.

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