NASE News

Ask The Experts: Website Disclaimer

Read this article in PDF form here.

Q:
I own a sole proprietorship. I have begun to recommend other businesses and their products on my website. It is my understanding that I need to have a disclaimer to protect my business as much as possible. If this is the case, what kind of disclaimer is best and how do I create one? Also, where is the best location for the disclaimer on my website?


A: I would definitely put a disclaimer on your website. It’s a little tricky because you are, in a sense, endorsing others by listing them. In most states, the referring person has not been held liable unless they knew or should have known about some type of incompetence or problem. You should make clear that this is not a specific endorsement, and that each person should make their own decisions about whether the particular provider is right for them. If the endorsement is paid (either in money or services), that should also be disclosed.

I also favor a disclaimer that covers linking agreements. Many people do not understand where your website ends and another begins. You should also consider a privacy statement for your site and make sure you follow it. The Federal Trade Commission has some information about protecting consumer privacy.

For disclaimers as well as privacy statements, I recommend reviewing the language used on the websites of other businesses for typical language and ideas.

The placement of the disclaimer really depends on what the website and the specific pages look like. You want to find a balance between the extremes of a disclaimer so burdensome that it renders the website ineffective, and one buried in fine print where no one can find it. In most cases, I would suggest a common-sense approach. You can on a few pages include a fairly simple disclaimer that there is no endorsement, warranty, or guarantee, or that you “disclaim all warranties, guarantees, and liability.”

The clicking of a box, or “clickwrap,” is a great place to include a disclaimer around the purchase of goods if you have the technology. If you are selling, linking, or posting the trademark of another, in a perfect world the product provider will through a contract agree to indemnify you if a claim is made.

For the most part, the courts have not found referrers liable unless they knew or should have known of a problem with the vendor. The exceptions are when a special fiduciary relationship exists with the customer (more than just a website relationship), or when the referrer is holding itself out as a consumer product review-type group. Of course, the goal is to avoid getting into litigation in the first place, so the better you set expectations up front, the better off you are.

Mike Beene, NASE Legal Expert

Read this article in PDF form here.