Unilateral amendments: Posting a notice on a Web site may not be enough

From a federal appellate court opinion:

Parties to a contract have no obligation to check the terms on a periodic basis to learn whether they have been changed by the other side.¹

¹ Nor would a party know when to check the website for possible changes to the contract terms without being notified that the contract has been changed and how. Douglas would have had to check the contract every day for possible changes. Without notice, an examination would be fairly cumbersome, as Douglas would have had to compare every word of the posted contract with his existing contract in order to detect whether it had changed.

Indeed, a party can’t unilaterally change the terms of a contract; it must obtain the other party’s consent before doing so. This is because a revised contract is merely an offer and does not bind the parties until it is accepted. And generally “an offeree cannot actually assent to an offer unless he knows of its existence.”

Even if Douglas’s continued use of Talk America’s service could be considered assent, such assent can only be inferred after he received proper notice of the proposed changes. Douglas claims that no such notice was given.

[Other cases] on which the district court relied, are not to the contrary. The customers in these cases received notice of the modified contract by mail.

Douglas v. US District Court ex rel Talk America, No. 06-75424, at 9072-73 (9th Cir. July 18, 2007) (granting writ of mandamus, vacating district-court order compelling arbitration) (emphasis original, citations omitted, extra paragraphing added).