A court has ruled an automatic email sign-off counts as a signature on a contract in a landmark legal case regarding contractual disputes.
The case was brought by Daniel Wise, a solicitor at Manchester-based Slater Heelis on behalf of his client who wanted to enforce a deal to buy a property which he had done via solicitors over email. The court heard that the terms of a land sale deal were agreed upon between buyer and seller over a series of emails between their solicitors but the seller then tried to pull out of the proposed agreement without a hard copy contract having been signed.
However, Slater Heelis successfully argued the exchange of emails and email sign-off amounted to a binding contract of compromise under the terms of the Law of Property (Miscellaneous Provisions) Act 1989 and, thus, a deal had been agreed and signed off.
The court ordered the landowner to complete the sale of the property and to pay the costs incurred by Slater Heelis’ client.
The court’s judgment could have enormous implications for the whole property sector.
Daniel Wise of Slater Heelis said: “It is generally understood that the formality in buying and selling land and property is concluded in writing and signed by both parties, more commonly known as ‘exchanging’.
“Despite there being no case law on whether an email sign-off counts as a signature for a property contract, the court has now found that an exchange of emails in a single chain with a name at the bottom is essentially the same as a hand-written signature on a paper contract, even if it is an automatically generated signature.
“Property professionals, such as commercial directors and land agents could be committing their businesses to deals simply by entering into email correspondence.
“I would advise anyone entering into discussions on the terms of a property sale to exercise extreme care over what they write in emails; always label correspondence ‘subject to contract’ and seek professional legal advice before discussing the terms of a deal in writing, otherwise they may be forced to complete on a purchase or sale they no longer want.
“This is another example of how the digital age is changing the nature of how business transactions are completed and people need to be aware that the keyboard is as equally binding as pen and paper in the eyes of the law.”
This case along with comments from our property litigation expert, Daniel Wise, has been published in the following titles:
Manchester Evening News
Law Society Gazette
The Register
Lexology
Legal Futures
Civil Litigation Brief