We send hundreds if not thousands of emails every year. And, although some of those emails may be personal, fun, or informative. Many of them can possibly contain important discussions with details of deals or contracts. With a recent case that is currently making waves in Texas, the question is now being asked: are the emails we send legally binding contracts?
In 2011, the decision in the Naldi v. Grunberg ruled that emails are similar if not the same as ink-on-paper contracts. A 5-judge panel in the state of New York decided that commercial real estate transactions made via email can be proof of a deal and expands to the state’s Statute of Frauds.
October 8, 2019, Bujnoch, Life Estate, et al. V. Copano Energy, LLC, et al. case made it to the Texas Supreme Court.
In this case, an exchange of emails between two parties occurred with agreed-upon offers. Copano ultimately refused to honor the terms set forth and Bujnoch Life Estate sued them for breach of contract.
The Texas Supreme Court found that the emails consisted of all the essential elements of a legally binding contract: the terms of the parties’ agreement, the identity of the parties involved, and a description of the property being sold.
What is the final verdict?
Emails can, in fact, be legally binding and satisfy the statute of frauds.
Under the federal Electronic Signatures in Global and National Commerce Act (applied to all interstate and foreign transactions) and the Uniform Electronic Transactions Act (UETA) (used by California and adopted by many other states), a contract and a signature won’t be denied legal effect solely on the grounds that they are in electronic form.
How to prevent your emails from becoming legally binding?
Luckily for you, there are precautions you can take to limit liability and protect yourself. The first is to be careful with what you say in your emails. For example, if an offer, acceptance of the offer, consideration with talks of payment, and agreement of intention to legally bind the contract is mentioned then you have a recipe for a legally binding contract.
Adding an automated disclaimer to all your emails is highly recommended.
What is a disclaimer?
A disclaimer is a note, or a warning added to an outgoing email that is sperate from the main message.
The disclaimer should clearly state your intentions with phrases such as:
“For discussion purposes only and cannot be used to create a binding contract.”
“This email is nonbinding unless and until a more formal and definitive written contract between the parties is signed.”
Try it for free to secure your emails: