AbstractThis document deals with contract law and contract formation on the Internet. It summarizes the basic principles for forming a binding contract, as well as the appropriate method for achieving this on the web. Reference is also made to the case Hines v. Overstock.com, with an analysis of what Overstock.com could have done to avoid controversy. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an Original Essay It is well known that binding contracts were usually signed by hand before the Internet. The rise of the Internet has led to the adoption of laws such as the Uniform Electronic Transactions Act by a majority of states, and the Electronic Signatures in Global and National Commerce Act at the federal level, both essentially making electronic contracts just as enforceable as the written ones (Craig, 2013, pages 71-72). As expected, applying contract law to an entirely new medium (where both parties are usually not physically present) has raised some new questions and issues. Even if the requirements for creating a binding contract remain the same, how could one do this effectively on the Internet? In the context of Hines v. Overstock.com, Overstock.com lost the case for not sufficiently practicing the answer to the question. What Overstock.com could have done, as well as a brief overview of contract law and what is required on the Internet, will be covered in the following sections of this document. There are 2 fundamental requirements in contract law to enter into a contract, whether it is formed online or not. According to Craig (2013), “The basic requirements for an agreement are mutual agreement and consideration” (p. 73). Craig continues to explain that the ability of both parties to enter into a contract and a legal purpose for the contract are needed (p.73). These requirements, while important, will not be discussed further as this document focuses primarily on the mutual agreement requirement. That said, the concept of mutual agreement through the offering and acceptance of contracts electronically – especially when there is a large entity entering into hundreds of thousands of binding contracts per day in the form of end users or customers – needs a way to do this efficiently. It could be argued that both large and small online retailers cannot offer and control a specific contract every time a customer makes a purchase. According to Craig, this is resolved by using clickwrap agreements and browserwrap agreements to establish the mutual agreement in an electronic contract (p. 77). In summary Craig, clickwrap agreements occur when a program or website asks a user for an agreement (often called an end user license agreement or terms of use agreement) and the user must intentionally click a button which says "I accept" to continue. This document, however, is more about browserwrap agreements and will be discussed in the next section. As an alternative to clickwrap agreements, browserwrap agreements are also used to enter into a mutual agreement between the website and the user. According to Craig (2013), “With a browserwrap agreement, users do not need to “click” to accept the website's terms. Instead, browserwraps somehow indicate that use of the site constitutes acceptance of its terms of service” (p. 78). This initially presented a problem for the courts, as at first glance a website could seemingly hide its terms of use. However, there is one main consideration that courts use when.