A Canadian court recently encountered an intriguing
case1 regarding contract law where it had to determine
whether the use of the "thumbs-up" emoji (
) in a contract constituted a valid acceptance
of the contract. In this unique case, Justice T. J. Keene
acknowledged that the thumbs-up () emoji is an unconventional way of
"signing" a document, but only under the circumstances
where it conveyed both the identity of the signatory and acceptance
of the flax contract.
The court found that the flax contract in question was otherwise
in compliance with the provisions of the Sales of Goods Act, RSS
1978. Although a traditional signature typically denotes identity
and confirmation of an agreement, the court concluded that a
modern-day emoji like could also serve that purpose.
The aforesaid case involved two companies, South West Terminal Ltd. ("SWT") and Achter Land & Cattle Ltd. ("Achter"), that had done business with one another in the past. SWT sued Achter, a farming company, for breach of contract resulting out of an alleged failure on its part to deliver 87 (eighty-seven) tonnes of flax—a variety of seeds. The dispute arose when SWT claimed that Achter failed to deliver the agreed-upon amount of flax.
In determining the existence of a valid contract, the court emphasized the importance of consensus ad idem, or meeting of the minds. The court noted that Chris, who represented Achter, had a longstanding business relationship with SWT. Previous communications between Chris and Kent, the representative of SWT, demonstrated a consistent pattern of entering into valid and binding contracts on multiple occasions.
The court highlighted that Kent's use of the phrase
"Please confirm flax contract" and Chris' use of the
emoji were similar to previous
communications regarding durum contracts—the binding nature
of which were not disputed, despite the use of the emoji to communicate acceptance. Although
Chris claiming he was unaware of the meaning of the emoji, the
court considered the objective understanding of an informed
bystander, noting that the emoji is commonly used to express assent,
approval, or encouragement in digital communications.
Considering the circumstances and past conversations between
Kent and Chris, the court found that Chris had approved the
contract by using the emoji, just as he had done before. The court
concluded that a reasonable bystander, aware of the background/past
conversations, would understand that consensus ad idem was
reached in this case.
Addressing concerns about the broader interpretation of emojis, the court recognized the novelty of the case but acknowledged that it cannot impede technological advancements and common usage. Referring to previous case law involving electronic signatures, the court established that email and electronic non-wet ink signatures have been accepted as means of identification and approval of document contents to bring contract law up to speed with technological developments.
In this particular case, the court determined that the essential terms of the flax contract were clearly conveyed in the first page of the contract messaged to Chris, including the parties involved, the flax and the price. As a result, the court deemed the alleged flax contract between SWT and Achter to be valid, holding Achter responsible for breaching the contract by failing to deliver the flax. The court also determined that the damages payable to SWT amounted to $82,200.21.
This judgment highlights the significance of acknowledging that contracts can be accepted electronically, even through seemingly informal methods such as emojis, depending on the context. It serves as a reminder that subjective intentions of the parties hold no legal weight when determining the validity of a contract. Instead, the validity is assessed by considering the intentions of the parties from the viewpoint of a reasonable and objective bystander who possesses all relevant information that the contracting parties are privy to. If a reasonable and objective bystander would interpret sending an emoji as acceptance of a contract, the parties may be bound by the terms of the contract, regardless of the unconventional method of acceptance. Ensuring clarity in written communication becomes crucial in preventing disputes and ensuring that all parties have a clear understanding of their respective contractual obligations and the existence of a valid contract.
While not entirely uncommon, such cases remain relatively new and unique. A comparable incident occurred in 2017 involving a couple in Israel who were held liable for substantial fees after a court determined that their use of emojis in a text message to a landlord indicated an intention to rent his apartment. The couple had sent an enthusiastic text confirming that they wanted the apartment containing a string of emojis including a champagne bottle, a squirrel, and a comet. However, they ceased communication with the landlord thereafter and went on to rent a different apartment. The court ruled that the couple acted in bad faith and that emojis used in the message served as confirmation from the couple.
In the Indian context, a contract is valid if:
- there is a valid offer and acceptance;
- there is a consensus ad ideme., parties to the contract should accept the terms of the contract in the "same sense";
- the parties should be competent to contract;
- the consideration should be valid; and
- contract must be entered into out of parties' own volition and without the use of force or deception.
It would be interesting to note if Indian courts would consider
usage of a thumbs-up emoji () to be valid acceptance of the terms of the
contract and thereby consider a contract valid if all the other
essentials of a valid contract are also met.
It is important to exercise caution when using emojis, whether in conversations with a prospective landlord, a supplier, a service provider or an employee, as they could potentially be interpreted as a form of binding communication. Therefore, it is advisable to be mindful of the implications of emojis and consider the potential impact they may have. However, given that entering into a written contract is an exercise aimed at the reduction of ambiguity, emojis would continue to rank lower than other conventional methods of executing contracts.
Footnote
1. South West Terminal (SWT) v. Achter Land & Cattle Ltd., 2023 SKKB 116.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
