Private Law Theory

ABSTRACT
Company-crafted terms and conditions that supposedly govern modern consumer transactions are more lengthy, complex, and ubiquitous than ever before. Proliferation of online terms has been accompanied by increased judicial willingness to deem a contract duly formed based on passive and unknowing indicia of assent. Today’s consumer contracts are presumptively synonymous with a company’s online terms and conditions. Based on this framework, individuals cannot buy, join, stream, use, or access a myriad of goods and services unless they acquiesce to being legally bound to company-controlled terms.

Today’s ‘boilerplate terms’ are electronic rather than printed, and this means that increasing their length, number, and complexity is costless. Contract formation outside of the digital sphere usually requires more time, more party engagement, and more active indicia of assent. But online contracting reduces transactional friction. The online context of today’s contracting rewards transactions that are streamlined and sped up. The fewer clicks and more auto-fill content, the less time to reconsider prior to commitment, and the greater volume of transactions – and a company’s profit. In cyberspace, people do not bother to find and read proffered terms, let alone attempt to negotiate them.

Consumers are therefore subject in contract law to lengthy and changeable digital terms authored and controlled exclusively by the companies with which the interact. If no one pauses to peruse a company’s standard terms, no one notices whether they include waivers of legal rights, and no one notices when those terms become longer, more restrictive, and more unfair. The length and complexity of terms disincentivizes even prudent consumers from examining them. No economic, market, legal, or reputational constraint limits the length – and, to some extent, content – of terms that are presented via hyperlink.

Not only are today’s standard contracts more extensive; they also impact people’s lives more extensively. The ubiquity of modern consumer contracts reflects technological and market developments, for example, the huge growth of e-commerce. Recent business model shifts from acquisition to access has led to a proliferation of licensing terms. People rely on subscriptions to be entertained, informed, in contact, and involved in various networks. Online terms and conditions now establish private rules that purport to govern everything from riding an electric bike to listening to a hit song. Because, increasingly, software and other services come bundled with various tangible goods, even in-person purchases of goods may subject a buyer to a company’s standard terms. Companies have embraced the potential advantages that come from unchecked power over applicable private law and carefully construct custom-designed legal frameworks and strategically channel their consumer counterparties into the relationships that are, allegedly, governed thereby.

Most courts today presume that a company’s standard terms make up the content of the parties’ contract. These terms are thus legally enforceable unless a court finds them so unfair and so shocking as to require judicial excision. But company-controlled content is not the equivalent of mutually chosen terms and treating them as such strains the theoretical underpinnings of contract law and raises concerns regarding abusive waivers of consumer rights.

Part I of this chapter briefly traces how modern contract law’s treatment of non-negotiable standard terms evolved from early skepticism regarding contracts of adhesion to the liberal formation approach taken by the 2022 American Law Institute’s Restatement of the Law of Consumer Contracts. Part II discusses the mismatch between contract theory and consumer contracting reality and articulates law and policy concerns associated with common types of boilerplate waivers. Current tensions regarding digital contract enforceability and emerging issues in law and technology related online contracting are discussed in Part III.

Boyack, Andrea J, Modern Consumer Contracting and Online Terms (February 17, 2026).