Can E-mail Constitute A Legal Agreement?

Today the courts are busy collecting rulings made by states and the federal litigation venues looking to define what is legal or not concerning email. As case law is building it is becoming very clear—be careful what you put into your email, especially when discussing anything that deals with a contract.

Up until 2008, email was considered a “Non-Oral Modification” which for most agreements meant you could modify an agreement only in writing with appropriate signatures, electronic or pen. In Stevens v. Publicis, S.A. (N.Y. Sup. Ct. 2008) the court established that an email could satisfy a non-oral modifications clause. So even if a contract contains a provision that prohibits oral modifications and mandates that all amendments be signed and in writing, the contract could be capable of being modified by an email. The point here is to be careful when you send emails that involve contract discussions or performance modifications; they may change the terms of the agreement.

The new case law developing is around the defense of “I never saw that email.” Courts are requiring the plaintiff to produce evidence that the receiver of the email did in fact receive the email. As you can imagine, organizations that capture email “Proof of Delivery” prove the burden, “they did receive the email.” Caution though, not all Proof of Delivery solution are the same. The fact that an email was received is not enough in some cases, typically driven by the amount of the claim. Email authentication now comes to bare where the user must provide some access information such as a login or password. The most accepted is personal information or what is known as wallet security (etc. account numbers, SSN, driver license info), something personal that both sender and receiver knows. Second is the presence of a disinterested third party audit of the email exchange.

The next big item is attachments. Did they actually receive the email attachments? Documents provided by email also must be proven. Receiving emails are one thing, did the attachment make it and could they be read. Since email can encode attachments in many different ways, reading them becomes the challenge. Therefore, “Proof of Readability” becomes the evidence that the attachments were received and that they could be opened.

If you rely on email to conduct time sensitive business for mortgages, discuss terms or accept conditions, you should be using an email service that manages encryption, Proof of Delivery and Proof of Readability or you may find yourself out of compliance or worst, on the losing end of a legal case.

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