Can e-mails satisfy the statute of frauds and create binding contracts?
posted Jan 13, 2014, 8:12 AM by Helen Partlow [ updated Jan 13, 2014, 8:14 AM ]
Contracts for the sale of real estate must be in writing and signed. This requirement is often called the “Statute of Frauds” which can be traced back to English common law. The Massachusetts version of this law can be found at G.L. c 259, s 1. This means that the agreement cannot simply have a “hand shake” to seal the deal.
In modern times though, what constitutes “writing” and “signed”? Of course the standard paper and pen is what automatically comes to mind. But in this ever changing technological world we live in, can e-mails count?
Massachusetts has adopted the 2004 Uniform Electronic Transactions Act which can be seen at G.L. c 110G. This Act helped validate electronic contracts and signatures, but areas of uncertainty still exist.
In modern real estate transactions, the purchase and sale agreement are often negotiated via e-mail. Attorneys and clients alike often have signatures on the email which are simple but may pack a punch. In Feldberg v. Coxall (May 22, 2012), Judge Douglas H. Wilkins stated that the signature block of the e-mail may satisfy the signature requirement of the Statute of Frauds. In that particular case, an e-mail had an attached Offer to Purchase, which was never signed by the parties. Nonetheless, the signature in the e-mail alone may have been enough. However, no final determination is available as this case settled out of court.
Attorney Richard D. Vetstein on his Massachusetts Real Estate Law Blog suggests adding the following information into an e-mail:
“Emails sent or received shall neither constitute acceptance of conducting transactions via electronic means nor shall create a binding contract in the absence of a fully signed written contract.”
However, it is uncertain of a court would even accept this language and they may find a written contract even with this safeguard. Thus far, the courts have been deciding case-by-case.
The bottom line is that one should be very careful about anything they send that can be preserved such as in e-mails and even text messages. One of the most important things that the Court will look at is the parties’ intent. It is becoming clearer and clearer that a “meeting of the minds” and what the parties intended to do may be even more important than the traditional legal formalities.