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Can Avatars Make Contracts?
edadams sends in a story about the legal questions that are starting to crop up over property disputes in virtual worlds. A lawsuit in March 2008 that stopped one Second Life user from selling a virtual product created by another user marked the beginning of a significant amount of casework for several law firms, in large part due to the way Second Life's currency interacts closely with real money. (And yes, apparently the product in that particular case was for cybersex — did you have to ask?) "As transactions grow in volume, it's inevitable that disagreements will crop up. Linden says that although it will enforce its terms of service, including its ban on violating other users' intellectual property, it can't settle most disputes for users." A lawyer for one intellectual property firm handled a case in which the co-ownership of virtual real estate had to be determined, ending with a financial settlement given to two users who helped a virtual land developer run a group of Second Life islands. As virtual worlds get more popular and their business models more directly affect real-life finances, we can expect these legal issues to become more common as well.
Wow! They've productized cybersex? I thought it was a service! Is it over-the-counter yet? Does it come in a gel or powder that I apply to my genitals? I have so many questions on how it works. Can I get it delivered to my house discretely? Brilliant move but the physics are still a little confusing to me.
My work here is dung.
I'm not the biggest geek in the world but I consider myself to still be very geeky and I find this to be the most pointless waste of time and effort I've heard about since Twitter. Virtual lawsuits? Only if I can DM the lawyers.
I don't think us geeks are going to be complaining about the music kids listen to these days or getting off the lawn, we'll just bitch about how the impractical and useless the latest techno-geek fad is. "Twitter? What, blogs with RSS updates aren't good enough for you, son? Back in my day--"
"Back in your day your CPU only had one core and you liked it, right? Your polygons didn't even have textures, you had to customize your config.sys and autoexec.bat just to play--"
"Aw, shut up. And get off my lawn."
Kwisatz Haderach
Sell the spice to CHOAM
This Mahdi took Shaddam's Throne
Ultimately for a contract to be valid, both sides have to agree to it.
Exactly. Plus, the Statute of Frauds requires certain transactions to be documented in a signed "writing." But what is a "writing" under the law? Does this mean hard copy? Will the courts really enforce the Statute of Frauds strictly enough to avoid liability under electronic contracts as the Internet proliferates? Now that handwriting software and peripherals are an alternative to keyboard input, the signature requirement of the Statute of Frauds may no longer be an issue.
And what about the three-day right of rescission afforded consumers in certain transactions in California? For example, home solicitation contracts may be rescinded within three days of formation of the contract. These agreements are the result of solicitations by vendors at the consumer's home. The consumer must be provided with a hard-copy form that simply requires his or her signature and mailing within the three day period to void the contract. This "change of mind" provision may or may not apply to solicitations on the Internet if received on a PC at home. But perhaps they should. Likewise, seminar sales solicitations also allow a three-day right of rescission under different provisions of the California Civil Code.
And what about the Mailbox Rule? If contracts are accepted upon dispatch, does the sending of email cut off the right of an offeror to withdraw his or her offer notwithstanding the fact that the emailed acceptance has not yet been received? And what if the offeror sends his or her withdrawal of the offer before the acceptance is emailed, but the withdrawal is not received until after dispatch of the acceptance? Issues such as these must be addressed within the context of a technology that causes email delivery to be unpredictable and delivery records to be easily manipulated. The solution to these issues may be dealt with on a case-by-case basis as the specific fact patterns surface in the courts. However, a more efficient approach would be legislative committee research and formulation of a set of commercial statutes that will accommodate virtual contracts before litigation proliferates. Legislatures need not be visionaries to anticipate and resolve the inadequacy of present-day commercial law. The "Internet Commercial Code" would facilitate the free flow of commerce in the new medium and avoid the unnecessary burden of what is now foreseeable litigation. Indeed, an organization called the National Conference of Commissioners of Uniform State Laws is already working on a revised Uniform Commercial Code that will accommodate the new legal issues created by virtual contracts.
=Smidge=
Is it just my observation, or is eldavojohn an idiot?
The elements of a contract are mutual assent (offer, acceptance and meeting of the minds) consideration and absence of defects (such as lack of capacity or fraud). A signature is only one way of showing acceptance. Actions can also show acceptance. When you press "I accept" or something similar on an econtract, you accepted (though if someone who was not you accepted for you you could use a fraud defense assuming you can prove it was more likely than not someone else acted without your consent).
The medium through which a contract is formed does not matter. EULAS and TOS stand regardless of the electronic format. Having an avatar act as an online electronic agent for your RL self is still binding, assuming you are in control of the avatar. It is unclear what happens if you get hacked. Personally, I disagree with the trend to try to make one liable for all misuses of ones accounts, and i think if the defendant can show fraud and unauthorized use, the contract should not stand.
If avatars work in a virtual economy tied to real money, the contracts formed through avatar interaction are valid, whether you have a paper contract and real signature or not. However, given the logic of protecting yourself from a fraud defense of some sort, I can understand refusing to do business where significant amounts of money are involved unless you get confirmation of the other parties real identity. The contract can only be pure RP if no lindens are exchanged, because lindens are tied to real money. Think about the legal problems of gambling with lindens. It was arguably RP but if people won something that turned into money, various legal issues are triggered.
Not legal advice, just a few definitions and general conversation. IAMYL.