Terms and Policies Agreements

Oct 7, 2022
4 min read

Written by Sudipta Bandyopadhyay, Lawyer

Introduction:

Customers often accept the terms of the agreement without reading it. It is not that they are illiterate, but they think it is a waste of time. It is a rule to read a hundred times before signing a document because signing means accepting all the conditions and obligations with free consent and without any objection. This also implies that both parties cannot allege on any grounds which are not written in an agreement. Terms, clauses, and policies are important points that are kept in mind while drafting an agreement. OTT and e-commerce platforms, software, apps, and insurance policies are the best examples to explain terms and policies agreements. Every time a user uses these technologies, he has to accept all the clauses written in an agreement.

Definition of Agreement:

Terms and policies of an agreement are created by companies to avoid any type of legal dispute. The incidents of cyber crimes compel digital platforms to strengthen their rules and regulations to keep goodwill. Section 2 (e) of the Indian Contract Act, 1872 says that “every promise and every set of promises forming the consideration for each other is an agreement”. An agreement may be a social agreement or a legal agreement.
An invitation card to attend and have dinner at a marriage ceremony is a social agreement.
A legal agreement gives rise to contractual obligations and is enforceable in a court of law.
An agreement not enforceable by law is said to be a void agreement under Section 2(g). A void agreement does not create any legal rights and obligations. An agreement with a minor is always a void agreement.
An agreement that transgresses some basic public policy or which is criminal in nature or anything immoral is an illegal agreement.

Capacity of the Parties:

Parties should be competent under the eyes of the law to enter into an agreement. They can be individuals or business organizations.
In the legal sense, competent means that parties are not minor and of sound mind.
Parties have to freely consent to an agreement. Consent cannot be given under any influence or compulsion.
There must be an offer and acceptance between parties in a legal agreement.
Time limit or tenure, or terms of service in an agreement is another important condition. For example, tenure to watch an OTT platform or to use its license to show a movie or web series by any production house depends on the payment method. When the payment is failed, then the agreement is also terminated. Agreements get terminated when the conditions of an agreement are not followed by either of the parties or by both.

Parties are legally bound by the terms and policies of an agreement when they sign or acknowledge it. Terms and policies are made not only to avoid liability but also to protect Intellectual Property Rights. There are many types of legal agreements. One can go through an IP license or software license agreement to know about the rights and duties and how IP right is protected.

Lawful Object:

The object or purpose of an agreement should not oppose public policy. In simple language, it should not hurt morality. Public policies are policies of government for the welfare of society. Agreement against public policy would be void ab initio or, in Latin phrase, ex turpi causa non-oritur actio. In the case of Rattan Chand Hira Chand vs Askar Nawaz (AIR 1976 AP 112), two parties entered into an agreement in which one party had to influence the minister, and hence it was held void and against public policy.

Privacy Policy:

These days privacy policy is in the news. Every e-commerce and digital platform has to set its privacy policy before the users. Users have to share their personal and bank details with these platforms. These are private and confidential matters; therefore, the platforms are bound to share their pattern of using these details. It is also termed 'Data Protection.' This personal data paves the way to unveil the identity of a person, which, if goes to a criminal, can cause serious damage.

In the landmark case of Justice K.S.Puttaswamy ( Retd.) & Anr. vs Union of India and Ors., the constitution bench of the Hon’ble Supreme Court has held the Right to Privacy as a fundamental right subject to reasonable restrictions.

There are few laws to protect personal data in India. Section 43A of the Information Technology Act, 2000 protects against infringement of personal data.

Conclusion:

Recently the Indian Government has withdrawn its long-awaited Personal Data Protection Bill after long scrutiny. General Data Protection Regulation is a regulation on data in EU law that protects the privacy of data. Hopefully, new laws will come in the future to guide privacy policy in an agreement.