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Email, a Legally Binding Contract?

slashrot writes "Boston.com has a story on a dispute between a home buyer and seller in which they agreed on terms in a series of email messages. Superior court judge Ernest B. Murphy decided that even though these messages only contain typewritten names instead of signatures, they still constitute a binding contract. It's said to be a first in Massachusetts." The particulary look to me like a home seller trying to weasel out of a deal, but the ramifications of the decision are substantial. This is really worth a read.

9 of 204 comments (clear)

  1. Terrific! by cascino · · Score: 4, Funny

    This means that all those companies that send me spam are bound to help me lose weight, reduce my debt, and work in the comfort of my own home!
    This is terrific!

  2. Huh? by Ozan · · Score: 5, Informative

    I wonder why there is even a discussion over it. A contract never needs a signature, every time you buy a quarterpounder at McD you make a contract. Even multi-million-dollar transactions at the NYSE are made without handwritten signatures. As long as it is clear who the two negotiators are there is no doubt that two declarations of intention are made.

  3. Re:What's next, a handshake? Pinky-swear? by AgTiger · · Score: 4, Insightful

    As the chain of emails grows, the liklihood of one or both of the parties' communication being faked diminishes quickly.

    When you send an email, you can fake the headers, but if you have repeated two way communication, including quoted material, it's obvious you have a communication between two verifiable email addresses.

    The questions then become:

    1. Do the email addresses track back to the individuals in question?

    2. Did the parties involved in the dispute engage in this conversation together, or not?

    3. Could someone else have had complete send/receive control of the email account in question at the time over the time of the disputed conversation? (Man in the middle attack possibly?)

    Claiming one did not send emails when one did is a dangerous game when testimony under oath comes into play.

    What we have is a case of a "verbal" contract, though with written transcription as evidence.

    The judge may be breaking some interesting ground with this decision, but I don't think he's too far off the mark.

    And yes, digital verifiable signatures would be better. :-)

  4. Email Contracts by ZuG · · Score: 4, Interesting
    I had a similar (although less important) situation arise. I had agreed on a deal for two young ferrets (found through yahoo classifieds). We had extensive e-mail communications about what the animals' personalities were, that they were friendly and would not bite/attack people, etc. We had agreed on a set time and I made the hour drive to meet them and possibly purchase them.

    I get there, and the person and her brother basically shove the animals in my boyfriend's truck, without me really getting to see them. Right then, red flags should have gone up in my head, but I had talked to the seller extensively and thought I could trust her.

    I get the animals home, and it is clear that they are not at all what they were made out to be. One of the ferrets was extremely unfriendly and agressive, every time I would go near her, she would bite me, and she drew blood consistently. I emailed the girl back the next afternoon (a little less than 24 hours later, Michigan state law allows 72 hours to back out of a contract), telling her that I was backing out of the contract due to her untruthfulness. She emailed me back saying that she had contacted her lawyer (on a sunday, no less) and fed me a bunch of legal mumbo jumbo as to why she wouldn't take them back.

    Turns out, the girl wasn't even 18 (she had lied to me). I tried to call her parents several times but was never able to get into contact with them. I wanted to take it to small claims court and get my money back, but I didn't think that the emails alone would be enough to prove my side, and finally just let it go and sold the ferrets to someone experienced with agressive ones, for a substantial loss.

    I wish I would have known that my emails would have held up in court, I don't even think her parents had a clue what was going on. Ovbiously, it was partially my fault for being so trusting, but I found it hard to believe that someone I had talked to so extensively (probably 50k worth of email) would be so dishonest.

    I learned my lesson from the experience, but knowing that my emails could have backed up my story might have made for a different ending for me.

  5. Statute of Frauds, definition of signature by coyote-san · · Score: 5, Interesting

    This struck me as a weird ruling at first, then I realized the judge actually has a better insight into the situation than us!

    The weirdness is the "Statute of Frauds." Verbal contracts are not binding in a handful of situations, and sales of Real Property are one of them. (Real Property is real estate, easements, etc., transactions that still need to be traceable hundreds of years from now.) In these cases you *must* have a written contract.

    But then I remembered that a "written" contract just means that it was reduced to "tangible" form. This usually means something written on paper, but email is just as good as long as all parties stipulate that the contents of the messages have not been altered. (If the messages where PGP-signed, this wouldn't be an issue since you could detect alterations. Otherwise paper is still a far better choice.)

    Contracts need to be signed, though, and email isn't signed is it? Then I remember the research I did when a few particularly clueless individuals gave me grief about my illegible signature.

    According to the UCC, a "signature" is any tangible mark indicating consent. Nowhere does it say it has to be a cursive representation of your own name in your own hand. It could be printed, it could be completely illegible. It could be a mechanical reproduction applied by your secretary with a "signing machine." This is also why your bank will cash one of your "unsigned" checks - if you hand-wrote the rest of the information, *that* becomes your signature since it indicates an intent to pay. Viewing the bodies of email as self-signing, in a legal sense, isn't a far stretch. In this particular situation (negotiating terms of a contract), the alternative is to believe that one party was attempting to defraud the other.

    The only remaining question is whether the other party is who they claim to be, but this isn't a one-off message. This was an exchange that discussed something personally known to both parties (the property being sold), so the risk of impersonation is low. More importantly, it sounds like the issue is whether email can be viewed as a written contract, not whether any of the messages were forged.

    --
    For every complex problem there is an answer that is clear, simple, and wrong. -- H L Mencken
    1. Re:Statute of Frauds, definition of signature by danb35 · · Score: 4, Informative

      Exactly what I was about to say. Note that Uniform Commercial Code, Article 2 only applies to contracts for the sale of goods (not land), but most of the principles in the UCC reflect the common law. In particular, from section 1-201:

      (38) "Signed" includes any symbol executed or adopted by a party with present intention to authenticate a writing.

      . . .

      (45) "Written" or "writing" includes printing, typewriting, or any other intentional reduction to tangible form.

      Doesn't mean the guy's going to win, just that it's not going to be thrown out on the grounds that the contract isn't contained in a "signed writing".

  6. E-SIGN: Electronic Signatures Act by Seth+Finkelstein · · Score: 4, Informative
    I'm not a lawyer. But look at the "Electronic Signatures in Global and National Commerce Act" (aka E-SIGN)

    It states:

    Definitions of Electronic Signature

    The E-Sign Act contains the following definition for an electronic signature: "an electronic sound, symbol, or process, attached to or logically associated with a contract or other record and executed or adopted by a person with the intent to sign the record." Further, an electronic record is "a contract or other record created, generated, sent, communicated, received, or stored by electronic means."

    Certain seems to be satified here.

    Sig: What Happened To The Censorware Project (censorware.org)

  7. Re:Did they agree that the email was real? by stripes · · Score: 4, Insightful
    E-mail has reciept notification. In this case the sender of an e-mail recieves an e-mail telling when the sent e-mail was recieved.

    Optional, and I think seldom supported. Definitely not on by default in sendmail. Just as importantly the receipt could be forged, so it isn't real useful.

    If the reciever of the e-mail edited the mail the date and time at which the file was last edited will be different than the time and date it was recieved

    Many (not all) systems use one large file for each mail folder. The one I used that didn't (MH) still marked up the file and lost the original time stamp (plus one can use "touch" to alter that as well).

    [editing the mail] is now, just as illegal as editing a contract without the other partys' consent

    Yes it is illegal, and immoral, but it is very hard to prove which party did it! If the two of us are in dispute, how could the court know which of is has the invalid document? In this country they will not just jail us both, nor will they pick at random. You need a lot stronger case then the one that proves at least one of us, but not which one of us forged the mail!

    Also If you send an e-mail you keep a copy of it in your sent folder. If it doesn't match what the other guy's got, then hoo hah!

    Of corse it doesn't match! The problem is proving which (if any!) was unedited! Is the "contract" saying $1.86mil or $1.94mil the real one?

    Nobody will be able to get away with using vi to get millions of dollars.

    Nobody will get away with an obviously unreasonable price, but one can claim the price was 10% or 20% higher (or lower) then the real one. You may not get that price, but you may well be able to get out of the "contract" by claiming you agreed to something different then what the other guy has.

  8. Bring it on! by praedor · · Score: 4, Funny

    So, when I've had sexual discussions with women over email, where we tell each other what we want to do to each other...that is binding? OK, fine by me. I can't wait to start fulfilling these contractual obligations.


    --
    In Bushworld, they struggle to keep church and state separate in Iraq as they increasingly merge the two in America.