New York Business Lawyers

The Devil is In the Emails—>Your Inbox Could Be Home to Binding Contracts

by / Monday, 09 November 2009 / Published in Featured, Startup & Corporate

Often I am asked if certain arrangements and deals are enforceable without a written contract. Sometimes, I am asked that question with a little bit of layman lawyering as to whether the so called “statute of frauds” (this is an ancient statute that essentially says certain classes of contracts) can cut off a contract claim. First, let me say that the law is blind, but not dumb. If there was a real arrangement oral or otherwise, rarely will a court will simply tell the plaintiff that he/she is without a paddle.

This is due to several major reasons. First, oral contracts are often enforceable. And secondly, even in the absence of a formal contract, increasingly deals are made through email and NY courts have read these emails to form a binding contract (this is because that ancient statute of frauds statute was amended to include electronic communications). Three new NY cases illustrate the courts’ willingness to enforce emails as a contract.

Al-Bawaba.com Inc. v. Nstein Techs. Corp., the court enforced an e-mail exchange on a licensing agreement as a “signed writing” under the statute of frauds, because sender typed his name at the bottom of a critical e-mail.

In Stevens v. Publicis, S.A., the court concluded an employment agreement was modified by virtue of the sender typing his name at the bottom of a critical email.

In JSO Assocs. Inc. v. Price, the court held that a typed name at the foot of an e-mail was not necessary to enforce a business broker agreement for a party that arranged to secure purchasers for a business.

So be wary of what you agree to in your next reply.

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