Can Texting Create a Binding Contract? – UpCounsel Blog

If you’re discussing a deal in an electronic message simple statements, while harmless in intent, could cause serious problems. Courts in recent years have decided that in some cases an email exchange can constitute a binding contract. Since communicating via smartphones became ubiquitous, another question has arisen: whether you could enter into a contractual obligation – even inadvertently – by sending a text. A recent case in Massachusetts suggests that, too, is a possibility.

The court held that because the text message was “signed,” there could be an enforceable contract.
The Text That Launched a Lawsuit
The case in question, St. John’s Holdings v. Two Electronics, involved negotiations for the purchase of a commercial building. The buyer’s broker had emailed the seller’s broker an unsigned Letter of Intent (LOI) as an attachment. The LOI, which the parties intended to be binding, had to be signed by both parties. The seller’s broker followed up by texting the buyer’s broker to ask that the LOI be signed and that a deposit be made.

Specifically, the text said:

“Steve. [Seller] wants [buyer] to sign first, with a check, and then he will sign. Normally, the seller signs last or second. Not trying to be stupid or contrary, but that is the way it normally works. Can [buyer] sign today and get it to me today? Tim.”

The buyer then signed the LOI and provided a check to the seller. But on the same day, the seller accepted a third party’s offer for the property and refused to countersign the LOI. Rather than look for another property, the buyer decided to sue.

Source: Can Texting Create a Binding Contract? – UpCounsel Blog

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About Stephen G. Barr, Group Publisher

Author, Syndicated Columnist, Editor In-Chief and Group Publisher at SGB Media Group, a social media marketing firm specializing in digital media content production, publishing, affiliate marketing, public relations and advertising. Over 25 years experience in retailing, advertising, website & online forum development, niche social networking, affiliate marketing, search optimization, branding and identity, site location, non-profit fund raising. Event planning, promotion, production and MC/Host at public events. Author, Editor & Publisher of 35 syndicated, digital publications utilizing multiple digital distribution channels in conjunction with launching and administrating national advertising campaigns for major Fortune 500 advertisers in partnership with Google, Ning, Facebook, Myspace, Yahoo, DoubleClick, LinkShare, PepperJam and other industry leading third party affiliate networks. Product development team member from conception to launch on many websites, tangible goods and organizational structure for start ups. Specialties: Public relations, retailing, advertising, website & online forum development, niche social networking, blogging, email campaigns, affiliate/performance marketing, search optimization, branding and identity, site location, event production & promotion, non-profit fund raising and tasteful, responsible adult content publishing. An internationally recognized and read social media columnist & pundit on The Examiner, Associate Content, Vator.tv, X-Biz.net and Technorati and his own affiliated sites.
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