SJC says Uber agreements with riders unenforceable 

Terms and conditions do not give ‘reasonable’ notice 

THE AGREEMENT UBER users must sign before registering with the ride-hailing service – the detailed fine print listed under “terms and conditions” – is not binding in Massachusetts because it is not provided to users in a clear and conspicuous way, the Supreme Judicial Court ruled Monday. 

“The app’s registration process did not provide users with reasonable notice of the terms and conditions and did not obtain a clear manifestation of assent to the terms, both of which could have been easily achieved,” Justice Scott Kafker wrote for the court in a unanimous, 43-page decision. 

A 2018 ruling in federal court had found that Uber’s rider app did not provide adequate notice to users, and in this case, the SJC made a similar finding at a state level. The ruling has potentially larger impacts for how internet apps must present their online agreements in order to make them enforceable.  

The ruling stemmed from a lawsuit filed by Uber rider Christopher Kauders, who said Uber drivers denied him service three times in 2015 and 2016 because he is legally blind and uses a guide dog. Uber said Kauders must submit to arbitration because when he registered with Uber’s rider app, he agreed to Uber’s terms of use, which included an arbitration clause. Kauders said Uber’s account registration process did not give him reasonable notice of the terms. 

The SJC sided with Kauders. Kafker wrote that Uber’s registration process for drivers included a much clearer notice of terms and conditions and required explicit consent. “Here, in remarkable contrast, both the notice and the assent are obscured in the registration process,” Kafker wrote. 

The Uber registration process includes, on the same page where it asks for credit card information, a link to Uber’s terms and conditions. The terms and conditions are extensive, farreaching, can change without notice, and are favorable to Uber. The court looked at whether Uber provides “reasonable notice of the terms and a reasonable manifestation of assent to those terms.” 

In this case, Kafker wrote that is not obvious to the user that signing up for future ride-sharing services creates a contact accompanied by extensive terms and conditions – including those as significant as signing away the right to sue should a rider be injured in an Uber car. While a link to the terms and conditions is posted on a user’s screen when they are registering, it is not displayed prominently, and a user does not have to click on it. It is on the same screen where one enters payment information, in a less noticeable spot than the payment information. A button at the bottom of the page asks the user to simply click “done” – not “I agree.”  

This is different from the contract Uber enters into with drivers, where drivers have to click on a hyperlink to review terms and conditions then click on a box indicating their agreement with those terms. Drivers must click an “I agree” button, then click on a second affirmation saying they have reviewed all documents “and agree to all the new contracts.” 

“The contrast between the notice provided to drivers and that provided to users is telling,” Kafker wrote. “As Uber is undoubtedly aware, most of those registering via mobile applications do not read the terms of use or terms of service included with the applications.” Kafker says the design of the interface for the app “enables, if not encourages, users to ignore the terms and conditions.” 

The court concluded that this notice is not reasonable, since unlike the contract Uber enters into with drivers, a rider can register for the app without reviewing or agreeing to the conditions. “In such a transaction, a user may reasonably believe he or she is simply signing up for a service without understanding that he or she is entering into a significant contractual relationship governed by wide-ranging terms of use,” Kafker wrote. 

An Uber spokesperson did not immediately respond to a request for comment.