Safe Shopping Online

More and more of us are buying products online, whether through the sites of vendors who also have actual brick-and mortar stores, or from folks whose whole business is on the Internet. Online auctions are particularly popular.

Cybershopping can be safe-if you follow some precautions and are aware of the protections the law allows. These recommendations are adapted from a site developed by the American Bar Association's Section of Business Law. You can visit the site at www.safeshopping.org.

This is a fluid, rapidly changing area of law (see brief articles on last page). If you're a businessperson selling online-or a consumer with a problem with an online purchase-you should consult your lawyer to determine your rights and responsibilities under state and federal law.

Secure Internet Connections

Many customers are concerned about the security of information they send over the Internet. Many sites use Secure Sockets Layer (SSL) technology to encrypt the credit card information that you send over the Net. These sites usually inform you they are using this technology. Or, check if the web address on the page that asks for your credit card information begins with "https:" instead of "http:"; if so, this technology is in place.

Phone-In Option

Rather give your credit card information over the phone? Many web merchants allow you to order online and give your credit card information over the phone. If you're more comfortable with this option, make a note of the phone number, company, the date and time of your call, and the name of the person who recorded your credit card number.

Passwords

If you use a password to log on to your network or computer, use a different password for orders. Some web sites may require you to create a password for future orders. You may want to create a special password for particularly sensitive sites, such as your home banking site.

Don't write down any password near your computer where someone could see it. If you do record it somewhere, reverse the order of the characters or transpose some letters or numbers. That way, someone finding it won't have discovered your true password.

Be very careful about responding to an e-mail, phone call, fax, or letter from anyone who asks for your password(s), social security number, birth date, bank account, credit card number, mother's maiden name, or other personal information. To verify that the person contacting you really does work for the seller, call and request to speak to that person directly. Except for your password and credit card number, you should never have to give any other information to place an order online.

You should only give your password and credit card number in a secure connection on a web site, not in ordinary e-mail. "Theft of identity," in which someone gets access to your bank account or gets credit cards or loans in your name, is a growing problem.

Safest Way to Pay

Paying by credit card is safer than paying by check, cash, or debit card. If you have an unauthorized charge on your credit card, under federal law your liability is limited to $50. In fact, some credit card issuers and web site operators say that under certain circumstances they will even pay this amount for you.

Besides, paying by credit card can help in a dispute. You may be able to dispute the seller's charges if the goods don't arrive or if you aren't satisfied with them and return them.

In addition, some credit card issuers grant you extended warranties or other advantages for purchases made with the card.

The Seller's Reputation

You might feel safer dealing with companies you already know and trust. If you're not familiar with the name and reputation of a company-and especially if a seller has sent you an unsolicited e-mail message ("spam")-find out more before you buy. You can check a company's reputation by contacting the Better Business Bureau (www.bbb.org) or the Office of the State Attorney General in your state or the state where the seller is located, which can be found through the website of the National Association of Attorneys General (http://www.naag.org/.htm.)

If you're buying from an individual, some online auction sites offer "feedback" areas where customers discuss their experiences with a particular person auctioning off goods. Before submitting a bid on an item, check the remarks made about the seller.

What's the Address?

With a physical store or a catalog, you know where to turn to if you run into problems. But in cyberspace, all you may have is a web address. Look on the site for a street address and phone number. (Be wary if the seller's only contact information is a post office box.)

International Buying

Since it's the World Wide Web, sellers might well be located in other countries. If so, you might not have the same legal rights, or be able to enforce your rights as easily, as when the seller is located in the United States.

Sidebar: 10 Shopping Tips

Here's a list of tips you should consult when shopping online.

1. Trust your instincts. If you don't feel comfortable buying or bidding on an item over the web, or if you feel pressured to place your order immediately, maybe you shouldn't.
2. Be knowledgeable about web-based auctions. Take special care to familiarize yourself not only with the rules and policies of the auction site itself but with the legal terms (warranties, refund policy, etc.) of the seller's items that you wish to bid on.
3. Double check pricing. Whether the product is being sold as new or used, be suspicious of prices that are too good to be true. Also consider carefully whether you may be paying too much for an item, particularly if you're bidding through an auction site. You may want to comparison shop, online or offline, before you buy.
4. Find and read the privacy policy. Read the privacy policy carefully to find out what information the seller is gathering from you, how the information will be used, and how you can stop the process. If a site does not have a privacy policy posted, you may not want to do business with that site. If it does have a privacy policy, there will probably be a link to it from the seller's home page, or it could be included with the legal terms.
5. Review the return, refund, and shipping and handling policies as well as the other legal terms. Look under "legal terms" or "disclaimers." If you can't find them, ask the seller through an e-mail or telephone call to indicate where they are on the site or to provide them to you in writing.
6. Check that the Internet connections are secure. Before you give your payment information, there are various icons and software programs that indicate that security software is in place.
7. Use the safest way to pay on the Internet. Pay for your order using a credit card.
8. Print the terms. You should print out and date a copy of terms, conditions, warranties, item description, company information, even confirming e-mails, and save them with your records of your purchase.
9. Insure the safe delivery of your item. If you're concerned about the safety of your package if there's no one home to receive it, ask whether you can specify that the shipper must receive a signature before leaving the package. Or, it may be safer to have the package delivered to your office.
10. Inspect your purchase. Look at your purchase carefully as soon as you receive it. Contact the seller as soon as possible if you discover a problem with it. Tell the seller in writing about any problem that you are concerned with, ask for a repair or refund, and keep a copy of your correspondence.

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Legal Update

E-Signature Bill Becomes Law

A new federal law gives online signatures the same legal validity as a signature in pen and ink for most-but not all purposes. The bill, which is expected to further e-commerce, will permit consumers to sign a mortgage or insurance contract online, as well as perform other tasks, such as opening a brokerage account.

The law assures that a contact shall not be denied legal status simply because its signature is electronic, but a safeguard is that most contracts and documents must be capable of being reproduced for later reference if they are to be enforceable.

However, no one is obligated to accept electronic signatures, and certain kinds of documents are specifically exempted from the law. These include wills, codicils and testamentary trusts, adoptions, divorces or other family law matters, notices of foreclosures or evictions from one's primary residence, and cancellation of health or life insurance benefits.

Law Evolves to Meet E-Commerce Demands

Besides new provisions on electronic signatures, state and federal law is adapting to the new world on electronic commerce. All 50 states have passed laws relating to electronic commerce, and there is a new Uniform Electronic Transactions Act that some states have adopted.

In addition, most consumer protection laws apply online as well, often supplemented in the states by laws aimed specifically at Web merchants. These often require the web merchant to prominently post the legal name of the business, its return and refund policy, and the street address where they conduct business. Sometimes procedures for resolving complaints must be included as well.

Other laws deal with protection of privacy online, including the collection and use of personal information for marketing purposes. Special guidelines apply to selling stock over the Web.

Any company maintaining a website would be well advised to check with their lawyers about the rules and laws that apply-and to be aware that the legal framework is highly likely to continue to evolve.

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Q and A on Housing Leases

About a third of all Americans rent rather than own their homes. Understanding the legal agreement that governs the tenancy is crucial for both the landlord and tenant.

Q. What is a lease or agreement?

A. They are contracts, either written or oral, in which the landlord grants to the tenant exclusive possession of a premises in exchange for rent for a period of time.

Q. Do all tenants have the same kind of lease?

A. No. Most tenants fall into one of two categories. If the tenant rents for a fixed period of time (that is, a term) and no notice is required to terminate, the tenancy is called a tenancy for years. This tenancy is usually in writing. It must be in writing if the term of the lease is longer than one year. If the tenancy continues indefinitely, automatically renewing from one period to the next, and if a notice is required to terminate, the tenancy is called periodic. This lease or agreement may be written or oral.

Q. What are the advantages of an oral versus a written lease?

A. For tenants with an oral month-to-month agreement, the major advantage is the ability to terminate the lease and move out without further rental liability with only a short notice to the landlord. The notice usually must be the same as the term of the agreement, commonly 30 days. Tenants are very mobile (20 percent move each year) and the ease of moving can be an important consideration.

For landlords, an oral lease provides an easy way to terminate the lease and make the tenant move out with only a short notice, or to raise the rent. The landlord is usually not required to state a good reason for the termination, as must be done in other cases.

Q. What are the disadvantages of an oral lease?

A. Because nothing is written down, the major disadvantage is the possibility of misunderstandings between the landlord and the tenant about the conditions of the tenancy.

Q. What are the most important lease clauses from the point of view of landlords?

A. The most important clause to landlords is the duty of the tenant to pay the rent in full and on time. This includes the right to charge a fee for damages if payment is late. Other important clauses grant the landlord the right to enforce the rules and regulations written into the lease.

Q. What are the most important lease clauses for tenants?

A. The lease states the duty of the landlord to maintain the physical condition of the premises. Other clauses might state the right of the tenant to terminate the lease if the landlord fails to make needed repairs. Where the law allows it, the tenant should have a clause specifying the right to hire workers to correct defects in the premises and to charge the landlord for the cost or deduct it from the rent. A clause giving the tenant the right to pay reduced rent is important if the landlord fails to make repairs.

Sidebar:

Q. How should the tenant or the landlord change the lease if either doesn't like certain clauses?

A. If either one can persuade the other to remove a particular provision, that provision should be marked out in ink on all copies. Both the landlord and the tenant should then initial the marked-out sections.

Many preprinted forms contain large blank spaces for the landlord and tenant to write additional agreements, which become part of the lease. These inserted paragraphs should be initialed by both landlord and tenant. If the spaces are absent or are too small, the additional terms should be written on a separate sheet of paper and signed by both the landlord and tenant.

Q. Does the law regulate the provisions in a lease?

A. Yes. Both courts and legislative bodies have made laws restricting the provisions in a lease.

For example, state courts have struck down lease clauses which provide that the tenant accepts the apartment in "as is" condition and that the tenant must pay the rent regardless of whether the landlord maintains the property. So, if a landlord sues to evict for nonpayment of rent in these states, tenants can defend themselves by arguing that the premises were not worth the full contract rent because of the deteriorated condition. This legal concept is called the implied warranty of habitability. It prevents the landlord from evading the responsibility to maintain the premises even if the tenant signed a lease waiving the right to maintenance.

Many states and municipalities have enacted laws that prohibit some clauses from residential leases. An example of a commonly prohibited clause is confession of judgment. Such a clause would permit the landlord's attorney to go into any court and to represent the tenant without any prior notice, service or process. The tenant would waive a jury trial, confess judgment to whatever the landlord sues for without any defense, waive all errors or omissions made by the landlord in making the complaint, and authorize an immediate eviction or wage deduction.

State and local law on renting residential property varies enormously. Consult your lawyer with any questions.

Auto collisions head the list of personal injury cases in this country. With more than 100 million vehicles on the road, it's inevitable that some of them run into each other-or some other inappropriate object-every day.

The question in each collision is how the people involved may be able to be compensated for the injuries they have suffered, whether these injuries are to their persons or their property. The law has evolved a number of standards to apply to these cases. While your lawyer is best suited to advise you about a particular case, we can give you some general legal principles that courts apply in such cases.

Who's at Fault

Negligence is the basis of most personal injury cases. That means that the person at fault did not set out to cause the problem, but his or her carelessness was at least partly responsible. (The issue of fault is very different in the "no-fault" states, which we'll discuss later.)

What happens when both parties are at least partly at fault? Let's say you're in a hurry one early morning, driving a bit over the limit and maybe too fast for the wet conditions. You come up to a green light at an intersection that's just turning yellow. You hurry through but the driver on the other street jumps the gun and gets into the intersection before his light is green.

You spin off the road and suffer injuries that could add up to thousands of dollars in medical expenses. The other driver escapes unscathed. You'd like to make sure he helps pay your medical expenses, but who's at fault?

Will the law support a claim against that driver? Is a lawsuit or full-blown trial likely to be worth the time and expense? If you receive a settlement offer, should you accept it? The answers may depend, in part, on whether you're in a contributory negligence, comparative negligence, or no-fault jurisdiction.

Contributory Negligence

In states that recognize the defense of contributory negligence, the other driver may well seek to prove that, by violating the speed limit on a slick road, you failed to exercise due care to protect yourself from the risk created by his getting into the intersection early. If he can further prove that your lack of care was a substantial factor in causing your injuries, the court might find you "contributorily negligent."

The result? You won't be compensated for your injuries unless you can show that the defendant's driving sank to the level of "intentional" or "reckless" misconduct.

The theory is that, since the accident probably wouldn't have happened if you had been driving safely, it would be unfair to let you saddle the defendant with all of the responsibility for it.

While the concept of contributory negligence was once common, today only a handful of states retain this doctrine.

Comparative Negligence

Many states have adopted a more modern approach-"comparative negligence"-usually by legislation, but sometimes by judicial decision. In the early '60s, only six states adhered to the doctrine, but beginning in 1965, the comparative negligence bandwagon started rolling.

In a comparative negligence jurisdiction, the first order of business for a judge or jury presented with your suit against the other driver is to calculate, on a percentage basis, the degree of fault attributable to each of you. Let's say the jury decides your speeding on a slick road was 20 percent responsible for your injuries, and that the other driver's running the red light contributed 80 percent.

On this theory, if the jury goes on to find that your damages consisted of $100,000 in medical expenses, you might be responsible for $20,000 and the defendant for $80,000.

Some jurisdictions follow a "pure" comparative negligence system under which you can recover some damages no matter how much you were at fault-provided that the other driver was also at fault to some extent.

More states have opted for a "modified" comparative negligence law. In these states, you are legally entitled to compensation only if your own negligence was below a certain percentage.

No-fault Insurance

No-fault insurance, as it applies to motor vehicle cases, may cove only medical expenses and lost wages. It usually protects the driver, passengers, and any pedestrians the driver strikes, though some states shield only the operator/registrant of the covered vehicle. The idea behind no-fault is that you must purchase a minimum amount of no-fault insurance in order to drive. In return, if you are injured in a car accident, you will be compensated by your own insurance carrier for your economic losses up to a specified level, regardless of who was at fault for the accident. There are exceptions. A driver operating under the influence of alcohol, for example, would not be covered.

Can you still sue the other driver? Not necessarily. In no-fault jurisdiction, you first must seek compensation from your own insurance company. Some no-fault plans then would prohibit you from suing the other driver unless you either could show that your economic losses reached a certain level or that your injuries included some specified serious conditions such as permanent disfigurement.

Other no-fault jurisdictions let you sue anytime, but require you to reimburse your no-fault insurer for its payments if you collect a judgment from the defendant.

As always, the situations vary from state to state. There's no substitute for giving all the facts to your lawyer and asking him or her to explain your legal options.

The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult an attorney for individual advice regarding your own situation.

Copyright © 2003 by Bulman, Dunie, Burke & Feld, CHTD. All rights reserved. You may reproduce materials available at this site for your own personal use and for non-commercial distribution. All copies must include this copyright statement.