Do you read the fine print?

We've all heard the advice to “read the fine print” before we sign anything, but does anyone actually do it?

I recently spoke with a man we'll call Randy. Six months ago, Randy went to a state fair, the kind that vendors of all kinds descend upon to hawk their wares.

One of those vendors was a hot tub company with a very recognizable name. They've been in business for decades. Randy stopped by their booth. “They had a specific color of cabinetry and material that was a perfect match for our deck, so I decided to order it,” he says.

He put down $3,000, with $2,000 due upon delivery. “Before I signed, I asked how long it would take to get the hot tub, and they said three months,” he said.

Six months later, Randy is not enjoying an ice-cold beer in his brand new hot tub. In fact, the company hasn't even started building the hot tub, which reps say is because they don't have enough orders for hot tubs with the same material that he ordered. “When I call, all they say is ‘read your contract,'” he says. Only he has read the contract, and it's so ambiguous that it doesn't answer his questions.

No One Reads This Stuff

“I know I should've read the contract,” says Randy. But the truth is that most of us would have done the same thing.

Think about how often you click “agree” to something like a new iTunes agreement, without reading a single word.

Why don't we read it? For one thing, most contracts are crazy-long. For instance, one study analyzed four major software sellers' contracts and found that they “were an average of 74,000-plus words, which is basically the length of the first Harry Potter book,” James Gibson, a professor of law at the University of Richmond, told the New York Times. So we don't read it because it's impossibly long, and it certainly doesn't read like a J.K. Rowling novel, even if it is the same length.

Also, even if you did read it, you probably wouldn't understand it. Randy even showed his contract to an attorney friend, who agreed that the language was very unclear.

Why Contracts Are So Impossible

Contracts are meant to protect a company in every possible situation, so they're lengthy. That's understandable, since companies are trying to avoid costly frivolous lawsuits.

But in some cases, user agreements and contracts take away your rights, allowing a company to be abusive, deceptive and even negligent. For instance, according to, it's not uncommon for contracts to make consumers agree to unfair terms, such as:

  • No courtrooms. The contract requires you to go to arbitration, sometimes in places far from where you live or work.
  • No class action lawsuits. “The ability to join a class action lawsuit is important because it is sometimes the only way that a person can get fair compensation for their problem,” according to “If the person is only asking for a small amount of money, it may be difficult to find a lawyer to represent them because the cost of suing the company may be more than the compensation they are seeking.”
  • No freedom of speech. You aren't allowed to criticize the product, service or company.
  • No accountability. The contract states that companies aren't responsible for cheating or harming consumers.
  • No binding agreement, for them. Some contracts give companies unilateral power to rewrite the terms whenever they want. “These types of changes are common in … cell phone contracts, credit card agreements or cable television agreements,” according to “One major problem with unilateral modifications is that consumers do not typically receive much notice of any changes made, as they are increasingly being posted online rather than sent directly to consumers.”

Some argue that the “informed minority” will protect the general public from abusive practices like these. In other words, the few who actually do read their contracts will prevent sellers from offering unfair terms. But a New York University study casted some serious doubt on the theory.

“We find that only one or two out of every thousand retail software shoppers chooses to access the license agreement,” write the researchers, “and those few that do spend too little time, on average, to have read more than a small portion of the license text.”

In addition, they found that “consumers may be less likely to access [agreements] from companies they trust, where trust may be proxied for by company size or degree of familiarity.” Randy says company size and familiarity are part of why he didn't scrutinize his contract. They weren't some fly-by-night company he'd never heard of.

What to Do Before You Sign

There aren't easy solutions to this problem. No one can read all the fine print. And usually, your only options are to accept it or to not use or buy the product. For instance, if you hated yourself enough to actually read the iTunes terms, and you didn't like the languaging in section 79 article 13, your only option is to not use the service at all.

But if you're making a large purchase, make sure you at least know the return or cancellation policy. Ask a sales rep to explain the policy and to highlight it in the contract. Make sure the contract is clear and matches what the rep is telling you. For instance, Randy might've asked the salesperson to point out where in the contract it says that his hot tub will be delivered in 90 days, along with the cancellation policy. His contract outlines neither.

Also, there's a slim chance that you can take legal action, even if you waived your rights. For instance, in 2005, a Connecticut man injured while snow tubing was granted the right to sue the company for negligence, despite signing a waiver. As reported by the New York Times, the State Supreme court noted that in most states, waivers are considered valid, even when a company has been negligent. “But after its decision, by a 4 to 3 vote, Connecticut is one of a handful of exceptions,” wrote NYT reporter Avi Salzman.

As for Randy, his attorney friend is going to send a letter to the hot tub company, asking to cancel the contract. There could be a loophole, he says, because the contract says it's irrevocable once the work on the hot tub has begun, which has yet to happen. Randy is also considering contacting the Better Business Bureau and the state fair that hosted the vendor.

But his attorney says there's a good chance he'll be out the $3,000 deposit. “I even asked the company if they'd just refund my deposit, and we could just part ways,” he said. “They said only the owner can issue refunds, and of course I can't get him on the phone.”

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