Health start-ups: Mind your Ts & Cs – the biggest lie on the internet?

Building on the previous articles in this series which look at key legal issues doctors need to consider when starting up a healthcare business, we now turn to the contractual terms and conditions. Now, a number of people have noted that legal terms and conditions on websites and in mobile apps play a key role in what has been called ‘the biggest lie on the internet’.

Let’s be honest here – how many of us, when faced with what looks like 300 pages of legal jargon that stand in our way, have simply ticked the box which reads “I confirm that I have read and accept these terms and conditions”, hoping that they didn’t contain anything too nasty? I have to hold my hand up along with everyone else to this one because, whilst solicitors might like to think that contracts are as good a read as a bestseller, the truth is that many of them are long, often written in a form of legalese and, frankly, a bit boring.

But this doesn’t mean that they are not important. It also doesn’t mean that there aren’t consequences for getting them wrong. For example, back in 2010 (and hopefully just to prove the point) GameStation temporarily changed their t&cs to say that, by accepting them, consumers were agreeing to sell their souls to the company, and around 7,500 people were said to have consented.

So, what type of terms and conditions might you need in setting up a healthcare business and what do you need to know about them? I have assumed here that we are talking about some form of online business [see also our previous article in the series on ownership of your website]. In this case, you are likely to need:

• website and / or mobile app terms and conditions of use [likely to be linked with the acceptable use policy];
• acceptable use policy [how people use the site or app including, but not limited to, leaving of comments and other interaction];
• privacy policy [crucial given the sensitivities about use of patient data. It is really closely linked to data protection and you need to understand what data you are proposing to use in order to write it properly. Please see our forthcoming article in the series which covers data protection law in more detail]; and
• cookies policy [a requirement to show what information is being gathered from users that way].

Depending on what kind of activities you are undertaking and the way you model your business, you might well also need:

• a contract with patients (where this goes beyond what is covered in the terms of use for website and / or mobile app);
• a contract with other doctors or medical practitioners (such as where you are offering medical services using a network of people); and
• other contracts such as contracts of employment for staff or a lease for occupation of premises.

Whilst all of these contracts are important, in the remainder of this article we will concentrate on the patient terms and conditions and – within that – two important areas to get right. One relates to ‘distance selling’ and the other is the Consumer Rights Act 2015.

Distance selling is relevant because of The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013, in force from June 2014. In this context ‘consumer’ means “an individual acting for purposes which are wholly or mainly outside that individual’s trade, business craft or profession” and ‘trader’ is someone acting for purposes which do relate to their trade, business, etc. Therefore, distance selling needs to be considered in the context of an online contract with patients or other users of your website or app but is likely not to apply in the context of a contract with a doctor for the provision of medical services.

‘Distance selling’ covers a contract for goods, services, and / or digital content which is not concluded face-to-face on the business premises of the trader or in a shop. Therefore it covers all contracts made online where goods or services are being sold which would in turn relate to online healthcare businesses in the UK. An important aspect of the regulations is the provision of certain information by the trader to the consumer. This includes information on:

• the total price payable;
• details of rights to cancel; and
• information about the trader.

The right to cancel in respect of services allows a person at least 14 days to cancel after entering in to the contract with you. This means that you should not start providing the service in the cancellation period unless the consumer has specifically asked that you do. In this case, whilst cancellation can still apply for any un-performed services, the consumer would still have to pay for any services they have asked you to perform. Often, of course, in online businesses people do want things done quicker than 14 days and therefore you would need to make sure your contract is clear about how all this would work in practice.

The Consumer Rights Act 2015 consolidates a lot of previous consumer protection law and brings in some new areas too. The Act covers the provision of goods, digital downloads, and (most likely to be relevant in the context of this series) the provision of services. One aspect that it covers is the terms and conditions which appear in your contract with each consumer / patient.

Some terms appear in a ‘blacklist’ – they are automatically unenforceable in a contract and (therefore) it is better not to write them in to a contract in the first place. These broadly are the same as in previous legislation such as not permitting exclusion or limitation of liability for personal injury or death caused by negligence. Other items appear in a ‘greylist’. These are not automatically unenforceable but will be subject to a ‘fairness’ test and so caution should be used in applying them. Examples here might be a disproportionately high charge in the event of cancellation or a clause limiting liability to less than the value of the services provided. Transparency is key in contracts with patients.

In conclusion, it is important that you understand both what types of contracts you need and also how to get the content of them right. Remember, any claims or challenges you face will still cost you valuable time (and potentially also money) to put right – even if they are ultimately unsuccessful – so working to get it right first time is key.

Even if those using your products or services end up engaging in ‘the biggest lie on the internet’, do make sure that you don’t.