Lessons from Disney – The Importance of Reading the Fine Print

Introduction

Recently, Disney made headlines with a controversial legal stance in response to a wrongful death claim. A man sought damages for the death of his wife, which occurred at one of Disney’s theme park restaurants.

Disney countered by arguing that the man could not pursue the claim because he had previously agreed to terms and conditions during a Disney+ free trial years earlier. Central to Disney's argument was its arbitration clause, which stated that "any dispute between you and us, except for small claims, must be resolved through individual binding arbitration rather than through a class-action lawsuit." Essentially, this meant the man had consented to resolve disputes through arbitration rather than through the courts, upon agreeing to the streaming service’s terms and conditions. Disney’s legal representatives also contended that whether the man had read the streaming service’s terms and conditions was irrelevant to the enforcement of this arbitration clause. Thus, failing to review the terms before clicking “I agree” still bound him to those terms.

This case highlights a crucial lesson: failing to read terms and conditions can have significant legal implications. Although Disney has since retracted this argument and agreed to address the issue in court, citing the sensitive nature of the issue, the incident underscores the importance of thoroughly reviewing terms before agreeing to them.

The Impact of the Disney Case in Australia

In Australia, protections exist under the Australian Consumer Law (ACL) against unfair contract terms. Businesses must ensure their terms and conditions do not override statutory consumer guarantees, such as unfair contract terms, as such terms may be deemed invalid and unenforceable when brought before the Court. The High Court of Australia’s decision in Allianz Australia Insurance Limited v Delor Vue Apartments CTS 39788 [2022] HCA 38 underpins this statement by clarifying that the waivers of contractual rights are generally revocable unless exceptional circumstances apply. The Court emphasised that preserving established contractual principles, such as the right to challenge unfair terms, is crucial.

Whilst the Australian Consumer Law provides some safeguards against unfair terms, it is complex to laypersons and consumers may find it challenging to invoke these protections against non-compliant vendors. The Disney case serves as a cautionary tale: it is essential to understand and review the terms and conditions before agreeing, as doing so can prevent inadvertently waiving your legal rights.

How Sharrock Pitman Legal can help?

At Sharrock Pitman Legal, we are committed to helping you navigate these issues. We offer guidance on drafting fair and enforceable contracts, ensure you understand your rights, and assist in addressing unfair contract clauses to safeguard your interests and ensure your agreements are both clear and equitable.

If we can be of assistance, please do not hesitate to contact us on 1300 205 506 or email sp@sharrockpitman.com.au.

The information contained in this article is intended to be of a general nature only and should not be relied upon as legal advice. Any legal matters should be discussed specifically with one of our lawyers.

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