Standard Form Contracts and the Duty to Read Richard Warner

Carnival Cruise Lines v. Shute The Shutes entered into a contract to take a cruise from Los Angeles to Puerto Vallarta. In international waters, Mrs. Shute slipped on a mat and fell. She sued Carnival Cruise Lines in Washington State, where the Shutes lived. The contract had a forum selection clause that required that suits be filed in Florida.

The Presentation of the Terms The terms were printed on the back of the ticket, which were sent to the Shutes after they paid for the cruise. A careful reader will find the forum-selection clause in the 8th of the 25 numbered paragraphs. Justice Stevens, dissenting.

The Majority Decision [W]e do not address the question whether respondents had sufficient notice of the forum clause before entering the contract for passage. Respondents essentially have conceded that they had notice of the forum- selection provision.

The Duty to Read It will not do for a man to enter into a contract, and, when called upon to abide by its conditions, say that he did not read it when he signed it, or did not know what it contained. Sanger v. Dunn, 3 N. W. 388,, 389 (1879). The argument is a normative one: If you have an adequate opportunity to read and understand the agreement, but choose not to, you assume the risk that the terms may be ones to which you object.

The Modern rule If a party has an adequate opportunity to read and understand an agreement, then that party is treated as if he or she read the agreement even if in fact the party did not do so. Justice Stevens dissent raises questions about what counts as an adequate opportunity to read and understand..

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Standard Form Contracts The courts generally find adequate opportunity to read and understand standard form contracts and online contracts, Provided that the presentation constitutes an offer (Specht v. Netscape).

Privacy Policies Too? Privacy polices are generally treated as enforeceable contracts.

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