EBOOK SERIES, NO.

SHIELD YOURSELF
FROM LAWSUITS

Protect yourself with disclaimers, refund policies,

and terms of use

Author Richard Best [website links obscured to comply

February 2022 with Facebook group rules]

Copyright and disclaimer

This ebook is protected by copyright owned by the author and his licensors. You may not copy, modify, or
distribute it without permission. It is for general informational purposes only. The author is not providing
you with professional advice of any kind, and no lawyer-client relationship is being formed. It is your
responsibility to seek your own professional advice, tailored to your circumstances, if required.
EBOOK NO. 6 – SHIELD YOURSELF FROM LAWSUITS 2

CONTENTS

WELCOME 3

INTRODUCTION 4

HOW AND WHY LIABILITY OR FINANCIAL RISKS ARISE 4

DISCLAIMERS 5

LIMITATIONS OF LIABILITY IN TERMS OF USE 8

REFUNDS 9

QUICK RECAP 11

DIGGING DEEPER INTO TERMS OF USE 12

WHERE DO WE PUT OUR TERMS OF USE AND HOW DO CUSTOMERS

AGREE TO THEM? 14

ALL THE BEST 15

EBOOK NO. 6 – SHIELD YOURSELF FROM LAWSUITS 3

WELCOME

Hello! Welcome to this sixth ebook from the Online Courses & Legal Stuff ebook series.

Creating a decent online course is not for the faint of heart. It takes considerable effort.
Among other things, we need to do some or all of the following:

• find our niche or dot;

• investigate whether it’s what people want;

• plan out the course;

• start drumming up interest in it;

• figure out what we’re going to say;

• sort out what images and other media or content we’ll use to strengthen our own
content and spruce it up;

• record and edit the course content;

• get the course online and sort out a payment gateway; and

• promote the course, promote the course, promote the course. 🙂

Amidst all these activities, getting the legal stuff right might not be at the top of your list.
However, getting the legal stuff wrong can have very negative consequences, from
failing to protect your course, to infringing other people's copyright, to breaching privacy
and anti-spam laws, to failing to shield yourself from lawsuits.

My goal in writing this ebook series is to help you get the legal stuff right and to avoid
these negative consequences. I want to help you launch your course in the knowledge
your content is legally sound and that you have the legal terms and statements you need
to protect yourself and flourish.

Let’s get stuck in.

EBOOK NO. 6 – SHIELD YOURSELF FROM LAWSUITS 4

INTRODUCTION

The purpose of this ebook is to explain a range of practical steps you can take to protect
yourself and your course-related assets from potential claims by your customers. To do
that, we’re going to:

• explain how and why liability or financial risks arise in the context of our providing
online courses;

• outline three steps we can take to reduce or limit those risks; and, then

• address each of the three steps in more detail.

Once we’ve done that, we’re going to dig deeper into terms of use, because they can be a
home for all three of the steps mentioned above, as well as a range of other important
controls and protections.

HOW AND WHY LIABILITY OR

FINANCIAL RISKS ARISE

For most of us, there are two main reasons why we develop online courses. The first is
to help people with the subject-matter we’re addressing in our courses. The second is to
make some money while we’re at it.

That’s all well and good. We need to be mindful, though, that in delivering our courses
online, we are putting ourselves out there – through the Internet – to people who are
buying our courses and who may have certain expectations as to what our courses will
do for them. Naturally, we want to serve our audiences – and serve them well – but it
can be difficult to please everyone, all of the time, regardless of their circumstances.
There’s always a risk that someone will complain. There’s always a risk that someone
might assert that they’ve relied on your course content to their detriment. For example,
they might say: “Look, I’ve spent $1000 on your course, I expected X, Y and Z, I relied on
what you told me, I spent more money doing what you said I should do, and it’s all been
for nothing.” Even worse, they might assert you’ve been negligent in what you’ve said in
your course.
EBOOK NO. 6 – SHIELD YOURSELF FROM LAWSUITS 5

So while, as course creators, our focus is on succeeding, on helping people, on doing the
right thing, it can also be important to remember that things can go wrong. And so it can
be important to take steps, before launching our courses, to protect ourselves in the
event that something does go wrong. And we need to remember that a customer could
make complaints about us, or our course, even when we have not done anything wrong.
Sometimes people just complain. Sometimes people like to have a crack at us.

So, how do we deal with these risks? The three main ways of dealing with them are
through the use of disclaimers, terms of use that contain contractual limitations of
liability, and refund policies. By the end of this ebook, you’ll have a good idea of how to
implement each of these mechanisms for your own course. I’ll be focusing on the laws,
broadly speaking, of the United States, Canada, the United Kingdom, Australia, and New
Zealand.

I should perhaps add that there are two additional steps you can take to protect yourself:
you can set up a limited liability company and operate through that, and/or you can take
out professional indemnity insurance to cover the risks that arise from allegations that
you’ve acted negligently (assuming it’s available in your country). This ebook doesn’t
address those additional steps. Instead, I’m going to focus on the three steps mentioned
above – disclaimers, contractual limitations of liability, and refund policies – that you
can take immediately, and without substantial time or cost, to limit your risks.

DISCLAIMERS

WHAT IS A DISCLAIMER?
First of all, what is a disclaimer? A disclaimer is a statement by which someone
“disclaims” something, or says they accept no responsibility for something. In a web
context, that “something” is often the accuracy of information that the person has
published. The main purpose of this form of disclaimer is usually to prevent a duty of
care arising, and that, in turn, can help the maker of the disclaimer resist claims, or
allegations, of negligence. This is usually done by drafting a disclaimer that makes it
clear that the materials you’re providing are only provided for informational purposes,
and that you are not providing professional advice to any person.

While on the topic of professional advice, I would add that disclaimers are also used to
make it clear that the mere publication of information on a particular topic, such as law
or health, does not give rise to a particular form of relationship between the person that
EBOOK NO. 6 – SHIELD YOURSELF FROM LAWSUITS 6

publishes the information and a person who reads it. Common examples are statements
that there is no lawyer-client or attorney-client relationship, or, in a health context, that
there is no doctor-patient relationship.

EXAMPLE OF A DISCLAIMER
Here's an example of a disclaimer you could use for your online course:

Disclaimer

Our course materials and other material you may access through the course or on
this site (together, Materials) are provided to you for general informational
purposes only. We are not providing you with professional advice of any kind.
Reasonable efforts are made to ensure the course content and other materials are
accurate, but we do not guarantee, represent or warrant the accuracy,
completeness or currency of any information provided, or that you will obtain any
particular results. Results may vary. You use the Materials at your own risk.
Customers requiring professional advice should seek their own advice from an
appropriately qualified advisor.

This sort of disclaimer can be added to your site and course materials without
necessarily being in a set of terms of use that your users or customers agree to,
although, as I’ll mention below, it can be helpful to do that.

If you’ve signed up to The 5-Step Legal Plan for Online Course Providers, you’ll have
access to a disclaimer builder that has some additional options for your disclaimer text,
if relevant to the subject-matter of your course.

BRINGING THE DISCLAIMER TO PEOPLE’S ATTENTION

It’s important to note that, in many countries, disclaimers need to be brought to the
attention of users to be effective. If they’re hidden – if users can’t easily find them – they
run the risk of not being effective. If you think about it, that makes sense. If people
cannot find your disclaimer, they won’t know that you are disclaiming responsibility for
something. They won’t know you’re saying that a particular kind of relationship does not
arise.

For this reason, it’s common for people to put a disclaimer link in their site footer, that
links to the text of the disclaimer, and to include the disclaimer in their terms of use, in a
manner that makes it stand out. You can make the disclaimer stand out by using colour,
font size, and/or capital letters. Personally I don’t like the capital letters approach, as it
makes the text more difficult to read and it’s a bit like shouting at your customers, but
that’s a matter of style and personal choice.
EBOOK NO. 6 – SHIELD YOURSELF FROM LAWSUITS 7

If you wish, you could also show your disclaimer in your course videos or in your course
downloads. That will improve the likelihood that your customers will see it.

I should mention that, if you’re using an online course platform, you may not be able to
add a disclaimer in the footer of the webpages. The important point is to put it
somewhere where your customers will see it. For example, you could put it somewhere
in your course description or, if possible, near a buy now button. Some online course
platforms make it easy to do this.

LIMITS OF DISCLAIMERS
Before leaving the topic of disclaimers, it’s important to note the limits of disclaimers.
This is a point that many people don’t understand. For present purposes, it’s important
to understand two main points:

• The first point is that, legally, it is not possible for a website operator or a Facebook
page or group administrator to disclaim responsibility for defamation or breach of
copyright. You cannot say: “Yeah, a user might post defamatory content or copyright-
infringing content, but I disclaim all responsibility for it and so won’t be liable to the
person who has been defamed or the person who owns the copyright that has been
infringed, regardless of whether I’m aware of it and regardless of whether I take it
down”. That sort of thing doesn’t work. Disclaimers cannot protect you from a cause
of action that a third party may have that arises from your involvement in publishing
defamatory or copyright-infringing content. There might be other defences in some
countries, in some circumstances, but a disclaimer won’t help you. The value of
disclaimers generally lies in making it clear to your users that you don’t assume a
duty of care to them in relation to what you are saying, and that you are not forming a
particular kind of relationship with them.

• The second point is that, in many countries, a disclaimer may not protect you if you
have been deliberately misleading or deceiving people. Now, of course, as course
creators we are not going to do that, right, but in some countries it can be an
important point to bear in mind. Note also that many countries have fair trading and
consumer laws that give consumers rights that you cannot disclaim or exclude your
way out of. It can be important not to suggest in your disclaimer that your disclaimer
overrides those mandatory laws.
EBOOK NO. 6 – SHIELD YOURSELF FROM LAWSUITS 8

LIMITATIONS OF LIABILITY IN TERMS

OF USE

WHAT’S A “LIABILITY”?
Before getting to limitations of liability, we first need to understand what is meant by
liability. Generally speaking, a “liability” is a legal responsibility that one person or
business has towards another. The liability could be a responsibility to perform an
obligation, or to pay a debt, or it could be a requirement to pay an amount of money –
called damages – if a court finds that the person or business has done something
wrong, like breach a contract or act negligently. In this ebook we’re focusing on the third
example: an obligation to pay damages, or meet someone’s expenses or losses, when a
court finds you’ve done something that the law considers to be wrong.

LIMITING OR EXCLUDING OUR LIABILITY

As online course providers, we are generally able to limit or exclude our liability. This
means we are able to say that we will not be responsible to our users, or our customers,
for damages, losses or expenses that they might try to assert we are responsible for. We
do this by entering a contract with them that contains clauses that limit our liability. That
contract usually takes the form of a set of terms of use or terms of service, or terms and
conditions as some people like to call them. So, to limit our liability we need to put our
own terms of use in place, and our users or customers need to either click to accept
them before purchasing our course, or be shown them (or a clear link to them) and be
given a chance to read them before purchasing our course.

CONSUMER LAW LIMITATIONS

Note that, in some countries or states, it may not be possible to completely limit our
liability to consumers (as opposed to commercial businesses). Consumers are generally
people who are purchasing in their domestic or private capacity, as opposed to a
business capacity. In some countries or states there may be a prohibition on unfair
terms in consumer contracts, or there may be restrictions on the extent to which we can
limit our liability to consumers. What lawyers will usually do to recognise such laws is to
say that a complete limitation of liability applies “to the maximum extent permitted by
law”. Sometimes they’ll acknowledge that the limitation may only be partly effective or
not effective in certain states. And sometimes, to accommodate laws that do not allow a
EBOOK NO. 6 – SHIELD YOURSELF FROM LAWSUITS 9

complete limitation of liability, they’ll insert a different limitation of liability provision that
applies to consumers.

EXAMPLE CLAUSE
So, what should we put in our terms of use? In particular, what should our terms of use
say on the topic of limiting or excluding liability? I suggest something like this:

Liability

You agree that, to the maximum extent permitted by applicable law, [I/we] will not
be liable to you for any claim, loss, demand, damages, costs or expenses of any
kind (including for negligence) (together, Excluded Claims or Loss) that you may
suffer or incur as a result of or in connection with your use of the information or
other material in, provided with, or linked to from, [my/our/ course(s)] or this
website. You accept that this means, among other things, that you will not be able
to make or bring any claim against [me/us] for any kind of damages, whether
direct, indirect, consequential, special, punitive or otherwise.

If you have rights under applicable consumer protection or fair trading laws that
cannot be limited or contracted out of, the exclusion of liability above will not apply
to those rights.

If under applicable law a complete exclusion of liability would be unlawful, then

[my/our] liability to you will be limited to the value of the price(s) you have paid for
the course(s) you have purchased access to.

REFUNDS

WHY REFUND POLICIES ARE USEFUL

Refunds are one of the means by which we, as online course providers, can build
customers’ trust in us and reduce the feeling of risk they may have in buying our course.
A refund can encourage a customer to buy in the knowledge that, if the course is not
what they expected or doesn’t provide value, they can request a refund. That’s why it’s
so common for online course providers to offer customers the ability to seek a refund
within a certain period of time after purchase. It removes an obstacle that might
otherwise prevent a sale.
EBOOK NO. 6 – SHIELD YOURSELF FROM LAWSUITS 10

The other major benefit of having a refund policy is that, if customers are able to get
their money back with a minimum of fuss, that will in all likelihood substantially lower
the risk of customers bringing claims against us.

Note also that some online course platforms require course providers to offer their
customers a refund. For example, at the time of writing this ebook, Mastermind.com
required sellers of online courses to provide buyers with an unconditional 30 day refund
policy for any product purchased on mastermind.com.

WHAT DOES THE LAW SAY ABOUT REFUNDS?

Legally, in many if not most countries, you are not required to offer a refund if a
customer simply changes their mind or doesn’t like your online course, especially if the
customer is a business rather than a consumer. Even when the customer is a consumer,
in many countries you’re not required to offer a refund unless the consumer has a
particular consumer right that has been breached.

At the same time, in other countries, and I’m talking here about the UK and European
Union member states, consumers have a right to withdraw from a contract concluded at
a distance, such as over the Internet, unless an exception applies. Interestingly, even in
that context, there is an exception concerning digital content that’s relevant to online
courses. That exception is this: the right to withdraw will not exist in contracts for the
supply of digital content which is not supplied on a tangible medium, if performance has
begun with the consumer’s prior express consent, and their acknowledgment that they
thereby lose their right of withdrawal. In other words, if they start downloading or
streaming your content and acknowledge they lose their right of withdrawal, then the
right of withdrawal is gone. So even in the UK and many European member states, we
can address the right of withdrawal by including a clause or statement along these lines:

“I hereby consent to immediate performance of the contract and acknowledge that

I will lose my right of withdrawal from the contract once the download or
streaming of the online course or associated materials has begun.”

But we can put the law to one side for now because, as noted above, it’s commonplace
for course providers to include a refund policy, enabling customers to seek a refund
within a certain period of time after purchase.
EBOOK NO. 6 – SHIELD YOURSELF FROM LAWSUITS 11

WHAT SHOULD A REFUND POLICY SAY?

There are various kinds of refund policies. For example:

• a refund policy might enable to customer to seek a refund within, say, 3 or 5 or 15 or

30 days from purchase, for any reason, no questions asked; or

• a refund policy might state that a customer can only seek a refund if certain
condition are met.

Examples of conditions are:

• having started to view the course, the customer has realised that the course doesn’t
provide what the customer needs; or

• the customer has a technical issue that the course provider is unable to resolve for
them; or

• the customer needs to demonstrate that they have attempted to implement the
course but have not been able to do so successfully; or

• a refund will only be granted if the customer has viewed a certain subset of the
course modules, say, 2 out of 5 modules, or 3 out of 10.

OTHER CONSIDERATIONS
Is there anything else we need to consider in the context of refund policies? Yes, there
certainly is. When someone signs up to your course, you’ll usually grant them some form
of limited licence to use the course content and any associated downloads for certain
specified purposes. You don’t want that licence to continue if someone seeks and is
granted a refund. So, it’s important to be clear – in your refund policy – that if someone
is granted a refund, then any licence they have to use your content comes to end, and
that they are required to destroy any of your course content or materials that they’ve
downloaded or that, for example, they’ve taken screenshots of. The general idea here is,
that if they obtain a refund, all rights they once had come to an end.

QUICK RECAP

So far we’ve looked at:

• the importance of disclaimers: the kinds of things they cover, the limits to the use of
disclaimers, and the desirability of including them in your site footer and in your
terms of use;
EBOOK NO. 6 – SHIELD YOURSELF FROM LAWSUITS 12

• the importance of including limits or exclusions of liability in your terms of use; and

• the desirability of having refund policies, different ways in which they can be written,
and the importance of bringing licensed rights to end when a refund is given.

DIGGING DEEPER INTO TERMS OF

USE

As noted above, disclaimers can be free-standing, that is, not part of terms of use.
However, it’s also desirable to have terms of use, and to include your disclaimer – or
disclaimers – in those terms of use. As explained above, limits or exclusions of liability
also go into your terms of use. And refund policies, or at least a cross-reference to them,
would also go into your terms of use.

We can see, then, that it can be important to have terms of use that govern a range of
things relating to the purchase and use of your online course. So far, though, we’ve only
looked at disclaimers, limits or exclusions of liability, and refund policies. Terms of use
will actually cover more than these topics.

For example, if you’ve read the first ebook in this series (Protect Your Course Content),
you may recall that I explained how online terms of use can supplement the protections
that copyright law gives to your course materials. They enable you not only to specify
how your course content can be used, but also to obtain agreement, from the people
who take your course, that they will not use your course materials except as you
expressly permit in the terms of use. And as I also mentioned, usually that agreement
will be enforceable as a matter of contract law. I mentioned that the terms might also
say that, if people taking your course wish to use your materials in any way that you’ve
not expressly allowed, then they must obtain your agreement before doing so. This
combination of terms makes it very clear what a customer can and cannot do with your
course content and, because they are in a contract, they give you a cause of action, or a
right of action, in contract, as well as the rights you would have under copyright law.

So, we now know that terms of use should cover disclaimers, limits or exclusions of
liability, refund policies, and copyright and licensing-related matters. They should also
cover some or all of these things:

• your identity details so your customers know who you are and how they can contact
you;

• an obligation to take care of their logins and not share them with other people;
EBOOK NO. 6 – SHIELD YOURSELF FROM LAWSUITS 13

• if relevant to your customer base, a provision targeting UK and EU customers that

concerns immediate performance and the loss of their right to withdraw from the
contract they enter into when purchasing your course;

• acceptable use of your course or website, and – if your customers are able to add
content to the site or course platform – requirements that they only add content they
are allowed to add and that they won’t breach people’s privacy or other rights when
doing so;

• indemnification of your business if they do add content they’re not allowed to add or
if they otherwise breach your terms of use, and you suffer loss as a result of that
(indemnification means they will cover you – they will pay you – for the losses you
may suffer as a result of their breach);

• provisions about fees, pricing and payment (if not already covered by a course
platform’s own terms);

• agreement to privacy provisions or a separate privacy statement;

• if you’re using an online platform like mastermind.com, Kajabi or Thinkific, a

provision explaining that you’re using a third party platform and will not be
responsible for any problems the platform may experience, such as hacking,
downtime, and any rights the platform provider may have and exercise against a
customer that you cannot control (you should note, though, that in some countries, a
clause like this will not remove your obligation to notify your customers of privacy
breaches affecting their information); and

• miscellaneous matters such as your ability to amend the terms, the law that applies
to the agreement, any complaints policy or process you may have, and where and
how disputes will be resolved.

As you can see, your terms of use need to cover quite a bit of ground. If you’re not a
lawyer and not familiar with legal matters and drafting, that can be quite a challenge.

Worry not! Build your own terms of use in no time!

Don’t be exposed by failing to have terms of use. You can build your own in no time, with
The 5-Step Legal Plan for Online Course Creators. The 5-Step Legal Plan contains a terms
of use builder with which you can build your own terms of use in a matter of minutes.
EBOOK NO. 6 – SHIELD YOURSELF FROM LAWSUITS 14

WHERE DO WE PUT OUR TERMS OF

USE AND HOW DO CUSTOMERS
AGREE TO THEM?

Once you have your terms of use, you need to know where to put them, and how to get
customers to agree to them. This is an important practical topic. It’s all well and good
having terms of use, but you need to ensure your customers are able to see them and
that they will be taken to have agreed to them.

In terms of placement, if you’re running your own site, the usual approach is to have your
terms of use on a page that is linked to from a “Term of use” link in the site footer. When
it comes to obtaining customers’ agreement to them (for example, when they purchase
your course), the optimal approach is to include a click to accept box that either links to
the terms or pulls them into a pop-up of some kind. By “click to accept box”, I mean a
checkbox that your customers need to click before they’re able to purchase your course.
The checkbox will say something like:

Please click to accept our terms of use.

If you’re using a course creation platform that doesn’t give you the functionality to add a
click to accept box, then you’ll need to rely on the so-called browsewrap approach to
acceptance of terms. This isn’t as robust as the click to accept process, and in some
countries there’s not much case law on its effectiveness, but it may be all you can
achieve. To achieve this, you’ll need a link to your terms (which could be a link to a
different page that opens in a new tab, or a link to a PDF download of your terms). Your
link will need to say something like:

In purchasing this course, you agree to our terms of use.

The words “terms of use” need to be hyperlinked to either the different page containing
the terms or to a PDF download of the terms.
EBOOK NO. 6 – SHIELD YOURSELF FROM LAWSUITS 15

ALL THE BEST

Congratulations! You’ve made it to the end of this ebook series. I hope you found it
useful, and that you now feel much better equipped to launch your course in the
knowledge that you’ve considered important legal issues and taken practical steps to
limit your risk. I wish you all the very best.