Civil Law Law Updates
A binding contract – yes or no?
You may have heard of the recent decision in the Court of King’s Bench in Canada which declared that a thumbs up emoji can serve for the purpose of a signature of a contract.
Mr Mickleborough, a Canadian, farmer had been in communication with a supplier of grain, Mr Achter, over the phone and via text message. The two had previously entered contracts with each other regarding farming supplies, which were dealt with in a similar manner to this contract in question. Mr Mickleborough messaged Mr Achter to enquire about a large delivery of flax to be ordered and delivered to Mr Mickleborough’s address. Mr Mickleborough prepared a contract of sale for the purchase, signed it, and sent it via text message to Mr Achter to read and sign.
In doing so, Mr Mickleborough wrote “[p]lease confirm flax contract”, along with the attachment of the signed contract. Mr Achter in response, sent back a thumbs up emoji “👍”.
Mr Achter claims he saw the message come through, and sent the emoji as a way to demonstrate that he will read the contract, sign it, and send it back to Mr Mickleborough. While this may have been his intention, Mr Mickleborough interpreted the thumbs up as confirmation that all the terms in the contract were agreed upon, he could expect the delivery of flax. As declared in court, the pair had executed similar contracts over text message, with Mr Achter responding “ok”, “yup” or “looks good” instead of the emoji.
The delivery time frame was listed as “nov” (November) in the contract. The flax was not delivered by Mr Achter, and thus, Mr Mickleborough pursued him for breach of contract. Mr Achter was ordered to pay more than $61,400 (approximately $70,000 AUD) for not delivering 8 metric tons of flax.
One of the larger principles of contract law is the intention of a party to enter a contract with another, by reaching ‘consensus ad idem’ (meeting of the minds). In the Canadian dispute, the defence did not successfully argue that Mr Achter did not intend to enter this contract.
This is a novel case that opens the door to the new reality of technology we are living in, and these advancements change the way we interpret something like a signature. There are numerous parallels between the Canadian court system and Australia’s. While Canadian decisions and judgments are not legally binding on Australian courts, judges are able to refer to the decisions as a suggestion or advice from another court. There is room for Australian judges to interpret this case how they wish, and pull elements and principles from it as they see fit. However due to the similar nature of the legal systems in both countries, there is a likely chance that similar matters may follow the same or similar outcome.
What will be interesting to see, is how the courts will progress with the advancement of technology and agreements like this in the future. I am sure most of us have sent an emoji in response to a question, which we may or may not have considered could be legally binding. There have been continuous disputes over unfulfilled contracts in the past within Australian courts, including the merits of a signature, but are yet to see how an emoji will be interpreted. This leaves the question of emoji interpretation in other matters, even outside contracts, and how they are meant to be interpreted by parties of a dispute.
If you find yourself in need of advice in relation to a contract or commercial legal advice generally, you should contact one of our civil lawyers at Aulich Civil Law @ firstname.lastname@example.org