Major v. McCallister

Citation: Major v. ServiceMagic, 2009 WL 4959941 (Mo. App. Dec. 23, 2009).

Factual Background
ServiceMagic operates a website which offers free referrals to prescreened construction contractors. Appellant Victoria Major used the ServiceMagic website to search for someone to remodel her home in Springfield, Missouri. Appellant answered a series of questions about her project, which involved visiting multiple pages on the ServiceMagic website. Each page included a hyperlink leading to the website terms and conditions, which also included a forum selection clause designating Denver County, Colorado as the forum for disputes.

Appellant hired co-defendants McCallister and Kalupto Creations who she ultimately sued along with ServiceMagic in Greene County, Missouri after becoming dissatisfied with their work. ServiceMagic was dismissed from the case based on its forum selection clause and Appellant filed an appeal.

Appellate Court Proceedings
A forum selection clause should be enforced unless it is “unfair or unreasonable to do so.” Appellant argued that she never assented to the website terms and that regardless, the clause should not reach her tort claims for fraud and negligence. The court disagreed and found that she had been given sufficient notice of the website terms to be bound by them. Additionally, because Appellant’s claims against ServiceMagic required an interpretation of the underlying contract, the forum selection clause should apply.

Despite Appellant’s discussion of the relative advantages of clickwrap licenses (whereby the user is required to click a button or check a box to indicate assent) over browsewrap licenses (where a user’s assent is implied through the use of service following notice of terms), both types of website and manifestation of assent are enforceable. While there is certainly less ambiguity with respect to user assent when it comes to clickwrap sites, browsewrap is not less enforceable per se but rather dependent on other aspects of the website such as placement of the terms and visibility of links. Courts usually uphold browsewrap agreements if the user “has actual or constructive knowledge of a site’s terms and conditions prior to using the site.”

Appellant argued that the court’s unwillingness to apply Netscape’s terms in Specht v. Netscape Communications Corp., should control this case. However, in Specht, Netscape’s terms were not visible at the point where a user downloaded software without scrolling down to another screen. This extra required step was enough for the court to hold that the user was not given proper inquiry notice to be bound by the terms. By contrast, ServiceMagic referenced the terms when Appellant used the site (“By submitting you agree to the Terms of Use”) and included a blue hyperlink to the terms next to the button that Appellant pushed. A second link to the Terms of Use was visible on the same page without scrolling and similar links were on every other page of the website. Ultimately, “[f]ailure to read an enforceable online agreement. . . will not excuse compliance with its terms.” Even Specht indicates that “unambiguous manifestation of assent to license terms” may be unnecessary if there is “an immediately visible notice” of their existence.

Whether a forum selection clause that by its terms applies to contract actions also reaches non-contract claims “depends on whether resolution of the claims related to interpretation of the contract.”<ref.Manetti-Farrow, Inc., v. Gucci America, Inc., 858 F.2d 509, 514 (9th Cir. 1988). Since Appellant’s claims of fraud and negligence hinge on whether ServiceMagic was in compliance with the contract at issue the court held that the clause designating Denver County as the forum for disputes was valid.