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View Full Version : How confusing can a general contract be for it to be legal?



tommac
2010-Nov-08, 04:41 PM
How confusing can a general contract be for it to be legal? and what is your opinion on the moral line and does it differ from the legal line.

For example do you think cell phone contracts are straight forward? And if not much razzle dazzle of something that should be straight forward should be legally and morally acceptable?

Heid the Ba'
2010-Nov-08, 04:54 PM
How confusing can a general contract be for it to be legal?
This comes with the caveat that I don't know where you live, but: generally you have to understand a contract for it to be binding. Signing it implies you have understood it.



and what is your opinion on the moral line and does it differ from the legal line.
There is no moral line, if you don't like the terms walk away.


For example do you think cell phone contracts are straight forward?
I'll leave this to someone who isn't a lawyer.


And if not much razzle dazzle of something that should be straight forward should be legally and morally acceptable?
I think this sentence goes to the root of your problem with contracts.

Fazor
2010-Nov-08, 05:10 PM
Insurance policies are legal contracts. They can be very confusing. Morally (ethically) I do my best to let the customer know what they're signing. As the agent, I take on some of that responsibility. But in the end, you're the one signing the paper and agreeing to the terms, whether or not you fully understand them. And honestly; most people don't care to even attempt to understand -- they just want the insurance because they legally have to have it.

Now my industry is governed by state law, and we cannot have something in a contract that hasn't first been approved by the state's Bureau of Insurance. So you have some protection there from intentionally misleading or dishonest practices. But that doesn't mean that the contract is easy to understand, or that you may misinterpret part of the coverage (for instance, many people don't realize that the 'Uninsured/Under-insured Motorists coverage' they carry does not cover a hit-and-run accident.)

I mean; how many of you have read through your insurance policies front-to-back? Or do you just trust your agent?

I'm assuming this thread has come out of your Direct TV discussion thread; so I'll mention that I'm not sure that television provider or cell phone contracts are as closely governed as insurance. I'm just more familiar with the later, since it's what I do. Or try to do, anyway. Though, like with insurance, it's up to the individual companies (be it the parent provider, or the installation contractor, or whatever) to either be straight-forward, or to maybe take advantage of the confusing nature of the contracts. Personally, I prefer to be straight forward and do business honestly. But maybe I'm just the dumb one for passing on opportunities to make myself more money at the cost of being honest.

tommac
2010-Nov-08, 07:06 PM
There is no moral line, if you don't like the terms walk away.

So walk away from signing anything where it may be vague or confusing to you? It todays America it seems that would leave MOST Americans without a car, house, phone, electricity or bank accounts.

Also are you condoning that there is no moral responsibility for businesses to not use tricky or decieving wording at all when trying to sell something?

For example, would it be OK for a company to offer something for $50 but on page 5 hidden in jibberish it states that you are signing up for $50 a day for life? Would there be anything to protect the consumer who is confused by this OR missed that line on page 5?

NEOWatcher
2010-Nov-08, 07:35 PM
It all depends on how you sue.

Some years ago, I bought a new car. On the contract in bold pre-printed numbers was an item named something like "dealer costs". I saw it and didn't think twice. Sure; the dealers have overhead in both thier own business and in just processing the sale. One way or another we are going to pay it anyway.
So; I agreed to the contract total price totally aware of this item.

Some time after that, someone opened a class action suit saying they were not told about this cost, nor had a choice. Somehow they won, and I got a voucher for dealer services.
Even though I benefitted from it, I thought the suit was completely baseless.

R.A.F.
2010-Nov-08, 07:39 PM
So walk away from signing anything where it may be vague or confusing to you?

Why would you sign something you failed to understand? For instance, I'm sure the disconnect charge was described in the contract, so there's no use complaining about that aspect of all this.

Also, will you be addressing the comments/questions pending on the other thread?

Torsten
2010-Nov-08, 07:49 PM
So walk away from signing anything where it may be vague or confusing to you?

Yes. When you've done your diligence, meaning you've taken steps to actually understand what the agreement means, and decided that you are comfortable with it, then you sign it. You're an adult. Take responsibility for what you are signing.


It todays America it seems that would leave MOST Americans without a car, house, phone, electricity or bank accounts.

Many people are lazy.

HenrikOlsen
2010-Nov-08, 08:08 PM
So walk away from signing anything where it may be vague or confusing to you?
Or spend the effort to learn to read contracts so it isn't confusing, and if it still is, ask before signing. And if it still is, don't sign.

In our modern society understanding contracts is a survival skill and people who can't be bothered to try to learn it are going to live a life of one nasty surprise after another.

Nereid
2010-Nov-08, 08:18 PM
Well, without wanting to get into a topic that may be called political, I get the impression, from the voluminous press on it, that there are actually two standards when it comes to some contracts in the USA. I'm referring, of course, to the many home mortgage contracts which require, by law, certain things of the mortgage owner (e.g. a bank) and also of the home owner. It would seem that many mortgage owners have been insanely literal when it comes to (many of) the home owners' responsibilities (wrt the contract), but astoundingly lax when it comes to their own. Not to put too fine a point on it, if you're one of these banks, you seem to have been able to foreclose on properties using procedures that are manifestly both illegal and breach the contract; if you're a home owner, you may be foreclosed upon even though you have manifestly not done anything illegal nor breached any terms of the contract.

tommac
2010-Nov-08, 09:49 PM
Or spend the effort to learn to read contracts so it isn't confusing, and if it still is, ask before signing. And if it still is, don't sign.

In our modern society understanding contracts is a survival skill and people who can't be bothered to try to learn it are going to live a life of one nasty surprise after another.


What if everyone got good at reading contracts but the lawyers got good at writing contracts that were more complicated ... is there any point where we need to cut them off and stop deceptive practices? Or are you saying that there should be no limit on any sort of contractual deciept. If anyone is stupid enough not to fully understand all of the legal mumbo jumbo then they deserve to be taken for any amount of money. Do you also feel this is true for the elderly or otherwise handicapped? Or would there be special exceptions for certain people? Would there be say an IQ limit ... say people with an IQ under 90 would be exempt? Or wouldnt they have the right to understand how much they are paying for their phone bill?

tommac
2010-Nov-08, 09:50 PM
Many people are lazy.

How about the IQ challeneged, those who cant read due to disabilities or the elderly? Basically those that arent just lazy?

tommac
2010-Nov-08, 09:53 PM
Were mortgages this complicated 100 years ago ... it seems that a mortgage should be fairly standard and straightforward based on local laws.



Well, without wanting to get into a topic that may be called political, I get the impression, from the voluminous press on it, that there are actually two standards when it comes to some contracts in the USA. I'm referring, of course, to the many home mortgage contracts which require, by law, certain things of the mortgage owner (e.g. a bank) and also of the home owner. It would seem that many mortgage owners have been insanely literal when it comes to (many of) the home owners' responsibilities (wrt the contract), but astoundingly lax when it comes to their own. Not to put too fine a point on it, if you're one of these banks, you seem to have been able to foreclose on properties using procedures that are manifestly both illegal and breach the contract; if you're a home owner, you may be foreclosed upon even though you have manifestly not done anything illegal nor breached any terms of the contract.

HenrikOlsen
2010-Nov-08, 10:25 PM
What if everyone got good at reading contracts but the lawyers got good at writing contracts that were more complicated ... is there any point where we need to cut them off and stop deceptive practices? Or are you saying that there should be no limit on any sort of contractual deciept. If anyone is stupid enough not to fully understand all of the legal mumbo jumbo then they deserve to be taken for any amount of money. Do you also feel this is true for the elderly or otherwise handicapped? Or would there be special exceptions for certain people? Would there be say an IQ limit ... say people with an IQ under 90 would be exempt? Or wouldnt they have the right to understand how much they are paying for their phone bill?
Life is test. Deal!

Torsten
2010-Nov-08, 11:33 PM
How about the IQ challeneged, those who cant read due to disabilities or the elderly? Basically those that arent just lazy?

Same deal. They need someone to help them understand what they are signing. If they are so impatient that they'll sign a document that appears to be mumbo-jumbo to them just so that they can have that new shiny thing right now, then they'll learn the hard way. And in many cases the very people you're describing will have someone watching out for them or they have the gumption to seek help. Lazy people who blame others for consequences of their laziness shouldn't be surprised when they get no sympathy.

slang
2010-Nov-09, 12:57 AM
Also are you condoning that there is no moral responsibility for businesses to not use tricky or decieving wording at all when trying to sell something?

And all advertising should tell the truth. Wouldn't that be a wonderful world. TV ads where the new fantastic great cheap innovating paint applicator competes with a normal brush or roller, yet now operated by professional painters, instead of some poor lady with two left hands. Magic tear-free onion cutters competing against people who actually know how to cut an onion, instead of hacking wildly into it.

Ronald Brak
2010-Nov-09, 02:04 AM
If NJ is where I think it is then I believe a contract can be extremely confusing and still legal. In Australia their are rules against a contract being unfair which include transparency.

If you are intrested in the details of what makes a contract unfair in Australia you can check out this googledoc:

http://docs.google.com/viewer?a=v&q=cache:ybfv8j-OQ58J:www.fido.gov.au/asic/pdflib.nsf/LookupByFileName/Guide-to-the-unfair-contract-terms-law-28052010.pdf/%24file/Guide-to-the-unfair-contract-terms-law-28052010.pdf+a+guide+to+unfair+contract+terms&hl=en&gl=au&pid=bl&srcid=ADGEEShaFuiIjSFqTezJ0_o_ps55QurG3IM_etWC_t_E VDyxQHvyBRkT-Fz2J_zUN-xZHBhxxrH8149zG7l7Skr0oaD7zTSSFa6Wb13C0zxTCMqBGamh DZJZ53rs6qyX5T0w48JZehiR&sig=AHIEtbTFEEfqxSzCsJVKCwaBkqP8yJB_Cw

Phone contracts are still confusing however, and intentionally made so.

Jens
2010-Nov-09, 05:45 AM
For example, would it be OK for a company to offer something for $50 but on page 5 hidden in jibberish it states that you are signing up for $50 a day for life? Would there be anything to protect the consumer who is confused by this OR missed that line on page 5?

I think probably that if that were the case, the contract would be challenged and probably the company would lose, because it seems like an unreasonable thing to do. I think the US legal system is based on an idea of what is reasonable, and I think any judge would probably take that to be an unreasonable thing to do.

Heid the Ba'
2010-Nov-09, 09:14 AM
What if everyone got good at reading contracts but the lawyers got good at writing contracts that were more complicated ... is there any point where we need to cut them off and stop deceptive practices?
At that point it is a political issue and you would need tougher consumer laws. Lawyers write what they are paid to write, they don't make the business decisons.


Or are you saying that there should be no limit on any sort of contractual deciept.
I am saying that to limit contractual obligations you need consumer laws. If you don't have those then, no, there is no limit. It is up to each individual to ensure they only sign what they understand and agree with.


If anyone is stupid enough not to fully understand all of the legal mumbo jumbo then they deserve to be taken for any amount of money. Do you also feel this is true for the elderly or otherwise handicapped? Or would there be special exceptions for certain people? Would there be say an IQ limit ... say people with an IQ under 90 would be exempt? Or wouldnt they have the right to understand how much they are paying for their phone bill?
Consumer laws or individual responsibility. If you don't like the current system change the laws.

Strange
2010-Nov-09, 10:24 AM
So walk away from signing anything where it may be vague or confusing to you?

I chose my mobile/cell phone service because they had a single tarrif, rather than a confusing array of different options including different montly payments with different levels of "free" minutes/texts, etc. Maybe I pay more, but I don't care because I understand what I am paying for. I refuse to pay "line rental" when there is no "line"!


In Australia their are rules against a contract being unfair which include transparency.

I believe there are similar rules in the UK but I don't know the details.

Heid the Ba'
2010-Nov-09, 11:48 AM
I believe there are similar rules in the UK but I don't know the details.

We have similar laws, some national, some EU. EU legislation tends to favour the consumer and any consumer contracts have to be clear and unambiguous. Business contracts don't as they are assumed to be between equals but where one party is a business and the other an individual the individual usually gets the benefit of the doubt.

Caveats for:
Sweeping generalisation
Not being the type of law I do
Being worth exactly what you paid for it.

tommac
2010-Nov-09, 01:01 PM
I am really looking at where the line is? How deceptive can / could a company be with its marketing/sales.


At that point it is a political issue and you would need tougher consumer laws. Lawyers write what they are paid to write, they don't make the business decisons.


I am saying that to limit contractual obligations you need consumer laws. If you don't have those then, no, there is no limit. It is up to each individual to ensure they only sign what they understand and agree with.


Consumer laws or individual responsibility. If you don't like the current system change the laws.

slang
2010-Nov-09, 01:10 PM
I am really looking at where the line is? How deceptive can / could a company be with its marketing/sales.

How would you define such a line? Seriously, how would you write such a thing down in a precise way that it can become law, other than by listing specific examples, or relying on court decisions?

Heid the Ba'
2010-Nov-09, 01:22 PM
Not to put too fine a point on it, if you're one of these banks, you seem to have been able to foreclose on properties using procedures that are manifestly both illegal and breach the contract; if you're a home owner, you may be foreclosed upon even though you have manifestly not done anything illegal nor breached any terms of the contract.

I haven't heard of this, (living in a different jurisdiction) but what legal basis do the banks have for carrying out illegal acts? Surely the courts won't support an action that is "manifestly illegal" or in breach of contract?

HenrikOlsen
2010-Nov-09, 02:09 PM
We have similar laws, some national, some EU. EU legislation tends to favour the consumer and any consumer contracts have to be clear and unambiguous. Business contracts don't as they are assumed to be between equals but where one party is a business and the other an individual the individual usually gets the benefit of the doubt.
At the risk of getting political, EU laws tend to favor EU businesses even if it's at the expense of customers as EU is still mainly a trade union, not a consumers protection club. When a law actually protects the customers it's because it's protecting them against non-EU businesses.

Anyway, yes. Learn you consumer rights laws, they occasionally override contracts by making parts of them illegal and it's a good thing to know when you can push back on a salesman when something went wrong. Don't expect miracles, they won't protect against willful stupidity.

Heid the Ba'
2010-Nov-09, 02:37 PM
At the risk of getting political, EU laws tend to favor EU businesses even if it's at the expense of customers as EU is still mainly a trade union, not a consumers protection club. When a law actually protects the customers it's because it's protecting them against non-EU businesses.


On this we differ, the Unfair Contract Terms legislation in the UK is driven entirely by EU legislation and protects the consumer against any business.

HenrikOlsen
2010-Nov-09, 03:31 PM
I think we differ in how we experience this because our countries started with different laws. In Denmark we already had such legislation in place and it's starting to get diluted by the EU.
I think it's the nature of any harmonization, those who are worst off will be pulled up, those who are best off will get dragged down.

chrissy
2010-Nov-09, 11:02 PM
What if everyone got good at reading contracts but the lawyers got good at writing contracts that were more complicated ... is there any point where we need to cut them off and stop deceptive practices? Or are you saying that there should be no limit on any sort of contractual deciept. If anyone is stupid enough not to fully understand all of the legal mumbo jumbo then they deserve to be taken for any amount of money. Do you also feel this is true for the elderly or otherwise handicapped? Or would there be special exceptions for certain people? Would there be say an IQ limit ... say people with an IQ under 90 would be exempt? Or wouldnt they have the right to understand how much they are paying for their phone bill?

My bold.
The parties must have the necessary capacity to contract and the contract must not be either trifling, indeterminate, impossible, or illegal.

Exempt from what?

If anyone is stupid enough not to fully understand all of the legal mumbo jumbo then they deserve to be taken for any amount of money.
It isn't legal mumbo jumbo Tommac, a contract is there to protect both parties. If you read a contract you would know where your rights were if they/you were in breech of the contract.

Ara Pacis
2010-Nov-10, 05:54 PM
Just because a clause is in a contract does not mean it's legally enforceable. There are some rights that you are not allowed to waive. They may try to tell you that you have to do something knowing well and good that you would win a legal challenge. They often expect you to bend over instead of fighting back, especially if the lawyers fees would be more than the monetary gain from a challenge.