Can a contract be formed by WhatsApp message, text message or email?

The legal position

The statutory framework. The Electronic Transactions Act, Chap. 22:05, provides as follows:

• Information is not to be denied legal effect, admissibility or enforceability solely on the ground that it is in electronic form (s 8).
• Unless the parties agree otherwise, an offer, an acceptance, or any other matter material to the formation of a contract may be expressed by information in electronic form. That includes clicking a designated icon (s 20).
• A legal requirement that information be in writing is satisfied by an electronic record that is accessible and capable of retention for subsequent reference (s 9).
• A legal requirement for a signature is met by an electronic signature that meets minimum standards of reliability and integrity, or that conforms with a standard the parties have agreed by contract (s 30). The criteria of reliability include whether the signature identifies the signatory, is uniquely linked to that person, is created by means under that person's sole control, and is linked to the document in such a way that any later alteration can be detected (s 31).

The rules of offer and acceptance continue to apply:

• Communication. An acceptance takes effect only when it is communicated to the offeror, which for electronic messages means when it is received rather than when it is sent. Unless the parties agree otherwise, an electronic message is deemed to be received when it enters an information system that the addressee has designated or uses for receiving messages of that kind, such as an email account or a messaging service, whether or not it has been opened (s 25).
• Counter-offers. A reply that introduces new terms, such as a different price or a different time for payment, is a counter-offer. It operates as a rejection of the original offer, which cannot thereafter be accepted. A genuine request for information, by contrast, does not operate as a rejection.
• Invitations to treat. An online listing or advertisement stating a price is ordinarily an invitation to treat, that is, an invitation to others to make offers. A message that merely states the lowest price that would be accepted is ordinarily not an offer either. A reply purporting to accept such a statement is itself an offer, which the other party remains free to decline.

Exclusions. The provisions of the Act on writing, signatures and original documents (Parts II to IV) do not apply where a written law requires writing, a signature or an original document for any of the following matters (s 6): wills; the conveyance of real or personal property or the transfer of any interest in such property; indentures, trusts and powers of attorney; immigration, citizenship and passport documents; and negotiable instruments.

Commencement. Parts I to IV and Part VII of the Act are in operation. The remaining Parts, including Part VIII on consumer protection, have not yet been brought into force.

Practical implications

Where one party states in a message that it will sell or supply on specified terms, and the other replies with an unqualified acceptance, a binding contract may be formed. A brief reply signifying assent may suffice where the offer was clear and complete.

An exchange that settles only the principal terms, and expressly leaves others for later agreement, may demonstrate that no concluded contract has yet been reached.

Electronic messages are not to be refused in evidence merely because they are electronic (s 8). Disputes about them typically concern authorship, the completeness of the record, and the meaning of informal expressions of assent.

Contracts concerning land should not be concluded by electronic message. They should be reduced to a signed written agreement. See Must a contract be in writing, signed or witnessed?

A contract for the sale of goods of the value of $100 or upwards requires particular care. Writing is necessary for its enforcement only where none of the statutory alternatives has been satisfied, that is, where no part of the goods has been accepted and received and nothing has been given in earnest or in part payment. In that event, the court may decline to enforce the contract in the absence of a signed note or memorandum, and it is not settled whether an exchange of messages suffices for that purpose. A part payment by bank transfer, bearing a reference identifying the transaction, satisfies the Act without any need for writing.

Recommended steps

A party that does not intend to be bound until a formal agreement is signed should say so expressly, for example by stating that the exchange is "subject to contract" or "not binding until signed".

A party that intends to accept an offer should do so in clear and unqualified terms, restating the essential terms: the price, the subject matter and the time for performance.

The complete record of the exchange should be preserved. Messages should not be deleted. The full conversation should be exported with its dates and times, and the device on which it is held should be retained. A screenshot is a copy, and its accuracy may be challenged. Any screenshot relied upon should show the sender's name or number and the date of each message.