Mark Pestronk
Q: In your April 13 column, "Protecting against client chargebacks after TSA-related chaos," you wrote that to defend successfully against a credit card chargeback, you have to prove, among other things, that the cardholder agreed to your terms and conditions by either a signature or a check box. What should the signature be on, and where should it be in relation to our T&C? What about a DocuSign or other electronic signature? How does checking a box prove agreement? Aren't there other ways to prove agreement? What about sending our T&C in an email with the itinerary? What about posting our T&C on or website?
A: The strongest proof that you can offer in your defense is what the credit card companies recommend that you do: obtain the cardholder's signature underneath your T&C and above a sentence stating "I agree to the foregoing terms and conditions, including the cancellation and refund clauses" or the like. Under the signature line, there should be a place for the cardholder to print his or her name and the date.
It doesn't matter whether the signature is on a piece of paper, an interactive webpage or a PDF with an electronic signature. Most of my travel industry clients prefer electronic signatures because requiring the customer to print out, sign, scan and email a signed T&C creates sales resistance.
Second best is requiring the customer to click "I agree" or check a box that is just below the online T&Cs before completing the transaction. Before the click or box, you need to add the same phrase, "I agree to the foregoing terms and conditions, including the cancellation and refund clauses."
I realize that, in all such transactions, you already have the cancellation and refund clauses in the body of the T&C, so adding the quote is redundant and calls the customer's attention to your penalties, which you probably don't want to do. Nevertheless, it is a best practice recommended by the card companies, so you should maximize your chances of beating the chargeback by doing it.
You could also put the signature on a webpage that does not contain the terms and conditions, but you have to provide a link to the terms and conditions right above the signature. Add the sentence, "I agree to the linked terms and conditions, including the cancellation and refund clauses" just above your signature.
Experts also recommend that, for online sales: a) the checkbox or button should not be prefilled, b) the customer should not be able to complete the booking without clicking or checking and c) your system should log the time and the IP address and should archive a copy of the transaction.
Third best is posting your T&C on your website and then linking to them or merely referring to them during the sign-up process. In this case, however, you are missing evidence that the customer actually agreed to your T&C.
Worst is merely posting the T&C on your website or emailing them without referring to them during the sign-up process, as you cannot possibly prove agreement. Unfortunately, this is what a lot of travel sellers do as they want to avoid any reference to penalties.