In a recent ruling from the Supreme Judicial Court of Massachusetts (“SJC”), the Court held that the Superior Court erred by denying Defendant’s motion to compel arbitration because the contract formation requirements were met, and Plaintiff reasonably manifested his assent to Defendant's
Terms of Use.
In Good v. Uber Technologies, Inc., 494 Mass. 116 (2024), Plaintiff was a chef at a Boston restaurant, and first registered an account with Defendant Uber in August 2013. On April 25, 2021, when Plaintiff opened Uber's app to secure a ride, he was presented with a screen that stated Uber had updated its Terms of Use. Plaintiff clicked a checkbox next to text indicating that he had reviewed and agreed to the terms. Only after performing these actions could Plaintiff proceed to order a ride via Defendant’s rideshare application. Days later, Plaintiff again used Defendant’s app to secure a ride, during which the Plaintiff’s uber driver collided with another vehicle, causing Plaintiff to be thrust forward, strike his head on the front passenger's seat headrest, and break his neck. Plaintiff was instantly paralyzed and was later diagnosed with a severe spinal injury and quadriplegia.
Defendant Uber’s updated Terms of Use, inter alia, required that users of Defendant’s application agree to resolve all disputes—including personal injury claims—through “final and binding arbitration,” and further waived the right to a trial by jury.
The main issue before the SJC was the enforceability of this arbitration provision or, more generally, whether an enforceable contract had been formed based upon the surrounding facts and circumstances. For an online contract to be enforceable, the Court stated, “there must be both reasonable notice of the terms and a reasonable manifestation of assent to those terms.”
As to the issue of notice, the Court highlighted the conspicuous nature of Defendant’s Terms of Use—for example, that they were hyperlinked in blue font, and a user could not proceed to use Defendant’s application without checking a box saying the user reviewed and agreed to the terms.
Significantly, the Court explained that even in the absence of Plaintiff’s actual review of all of Defendant’s Terms of Use, that a reasonable opportunity to review the terms would be sufficient to satisfy the notice requirement.
As to a reasonable manifestation of assent, the Court found that Plaintiff affirmatively manifested his assent twice—first when he was required to check a box immediately adjacent to text stating, “By checking the box, I have reviewed and agree to the Terms of Use,” and second when he was required to click a button stating “Confirm.” The Court found that the connection between checking the box and indicating assent to the terms was express and unambiguous—especially where Plaintiff could not proceed past the screen without indicating his assent.
Based on its analysis, the Court ultimately held that there was an enforceable online contract, and accordingly, that the Superior Court erred in denying Defendant’s Motion to Compel Arbitration.
This decision highlights two significant takeaways:
Users of applications and/or digital technologies, need to carefully read through and understand terms of use or service carefully before affirmatively indicating assent to such terms; and
Creators of online services, products, or applications, need to ensure that any terms of use or service are conspicuously displayed and that a reasonable opportunity for review of these terms is provided to users in order to have an enforceable, online/digital contract.