This post was written by Jameson C. Billings, a Dartmouth College junior who worked at Fitch Law Partners LLP during the fall of 2014.
As we conduct more business over email, electronic contracts are becoming commonplace--and in many cases they are legally enforceable. The mere fact that multiple parties have reached an agreement electronically makes their contract no less binding than a traditional hard copy agreement, as the Massachusetts Superior Court recently reminded us in Clean Properties Inc. v. Riselli ("Clean Properties") 2014 WL 4082266 (Mass. Super. June 20, 2014).
In Clean Properties, a property owner (defendant) sought a summary discharge of a mechanic's lien held by plaintiff Clean Properties, Inc., arguing that the contract between the two parties was not legally enforceable. The parties had entered into the contract when an agent from Clean Properties sent the property owner an email asking for permission to begin the project. The message stated, "You can give us your go ahead by stating the following: 'I agree with the terms of the contract identified as Project # 0941, Order 1 dated August 2, 2013. Please start the work right away.'" The defendant responded within half an hour with the exact message suggested by the Clean Properties agent, adding a standard signature block that included her name.
She later challenged the mechanic's lien that Clean Properties had on her property asserting that, in the absence of a document signed by both parties, no "written contract" existed as required by the mechanic's lien statute. The court held that her interpretation "cannot be squared with the Massachusetts version of the Uniform Electronic Transactions Act," which the Commonwealth adopted in 2004.
The Uniform Electronic Transactions Act MGL c. 110G states, "A record or signature may not be denied legal effect or enforceability solely because it is in electronic form"--and that "if a law requires a signature, an electronic signature satisfies the law." The plaintiff's comprehensive offer, followed by the defendant's emailed acceptance, formed a "written contract...enforceable under Massachusetts law."
Therefore it is a clear, unambiguous indication of agreement that creates a contract--with or without a traditional signature. Citing a 2004 case, the court noted, "[t]he parties must give their mutual assent by having a 'meeting of the minds' on the same proposition on the same terms at the same time." I & R Mechanical, Inc. v. Hazelton Mfg. Co., 62 Mass. App. Ct. 452, 455 (2004), rev. denied, 444 Mass. 1102 (2005). Such an agreement generally consists of an offer by one party, which contains all of the material terms of the contract, and the acceptance of that offer by the other party.
In Clean Properties, the court only directly addressed the definition of a "contract" under the mechanic's lien statute. However, its reliance on the Uniform Electronic Transactions Act suggests that whenever a "written contract" is required by statute, mutual assent to a set explicitly defined terms over email suffices.
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