Dan Brecher
Counsel
212-286-0747 dbrecher@sh-law.comAuthor: Dan Brecher|July 15, 2015
For busy business professionals, text message contract negotiations between partners is becoming increasingly common. Unfortunately, it is not the most legally sound way to negotiate a deal.
Many states, including New Jersey, have adopted the Uniform Electronic Transactions Act (“UETA”), which states that a “contract may not be denied legal effect or enforceability solely because an electronic record was used in its formation” and that “[i]f a law requires a record to be in writing, an electronic record satisfies the law.” Courts have also relaxed the rules regarding when an email signature is sufficient to create a contract. However, courts are still determining how best to apply traditional contract law to emails, text messages, and other types of electronic communication.
In any case, the basic principles of contract law still apply. In order for a business contract to be enforceable, there must be a valid offer and acceptance, supported by consideration. If one party sends a text message or email proposing different terms, the offer is considered rejected, and the contract formation process starts fresh. In addition, the parties must also intend to be contractually bound. While intent need not be expressly conveyed in the electronic communication, it must be clear that the parties intended that the agreement be legally binding.
To avoid a costly breach of contract lawsuit, below are five tips for text message contract negotiations, email or other form of electronic communication:
As a business owner do you find yourself making text message contract negotiations? If you feel you need to speak to an attorney regarding this issue contact attorney and editor of Business Law News Dan Brecher.
Counsel
212-286-0747 dbrecher@sh-law.comFor busy business professionals, text message contract negotiations between partners is becoming increasingly common. Unfortunately, it is not the most legally sound way to negotiate a deal.
Many states, including New Jersey, have adopted the Uniform Electronic Transactions Act (“UETA”), which states that a “contract may not be denied legal effect or enforceability solely because an electronic record was used in its formation” and that “[i]f a law requires a record to be in writing, an electronic record satisfies the law.” Courts have also relaxed the rules regarding when an email signature is sufficient to create a contract. However, courts are still determining how best to apply traditional contract law to emails, text messages, and other types of electronic communication.
In any case, the basic principles of contract law still apply. In order for a business contract to be enforceable, there must be a valid offer and acceptance, supported by consideration. If one party sends a text message or email proposing different terms, the offer is considered rejected, and the contract formation process starts fresh. In addition, the parties must also intend to be contractually bound. While intent need not be expressly conveyed in the electronic communication, it must be clear that the parties intended that the agreement be legally binding.
To avoid a costly breach of contract lawsuit, below are five tips for text message contract negotiations, email or other form of electronic communication:
As a business owner do you find yourself making text message contract negotiations? If you feel you need to speak to an attorney regarding this issue contact attorney and editor of Business Law News Dan Brecher.
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