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Behavior Online: An Application
of Semiotic and Legal Modeling
in E-Commerce
Electronic commerce has the potential to deliver goods and services to
customers more quickly, cheaply, and conveniently than ever before. But
before performance the obligations have to be created. This paper explores
the semiotic and legal aspects of online contracts. It reviews speech act theory
from philosophers such as Austin and Searle to explain how words and
actions can create legal obligations. It then examines English contract law
and its requirements to find an abstract basis upon which contract creation
can be modeled. Using semiotics and law, the paper thereafter creates a
model of the contract creation process and applies it to electronic commerce
in intangible goods. Since electronic commerce is so pervasive and extends
beyond any particular jurisdiction, the need is destined to increase for high-
level abstraction and for a model for comparison and cross reference.
By establishing agreements and expectations regarding future actions,
contracts enable business to be conducted in a stable context. For example,
contracting parties know when to expect deliveries of raw materials, and can
thus optimize their manufacturing processes, making gains in efficiency. In