Business Contracts, Signatures and Emojis 👍 – Legal Article

Have you ever responded with a thumb up emoji 👍 even if you have not read the SMS or email?  Well it is time to think twice before sending a thumbs-up emoji—especially if referring to a contract.

In June 2023, a Canadian judge ruled that a thumbs-up emoji was valid as a signature. In effect, the thumbs-up party had agreed to a contract; the contract was binding, and they had to perform their part of the contract (Southwest Terminal Ltd v Achter Land and Cattle Ltd).

The Facts

In 2021 Kent Mickleborough sent a bulk text to his clients stating he was looking to purchase 86 tonnes of flax at a certain price per bushel. Farmer Chris Achter called Kent and they spoke. Kent then texted a photo of a contract and asked Achter  to ‘confirm the contract’ .

Achter responded with a thumbs-up emoji.

However, the due date for the flax delivery arrived but Farmer Achter sent nothing.

Mickleborough took Achter to court asking for ‘performance’ (send the flax). In essence the two parties were disputing the meaning of the emoji: Mickleborough read the emoji as Achter agreeing to the terms of the contract; Kent believing he had signaled ‘contract received. Mickleborough demonstrated that in the past Achter had texted responses such as “ok”, “up” and “looks good” – and the contracts had been binding and honoured.  The only difference was the emoji.

So what is a signature?

Marks and fingerprints worked as valid signatures for hundreds of years. In Asia a chop–a stamp or an official seal – legally ‘signs’ documents in Japan, China, and Korea.  Link https://www.scmp.com/magazines/post-magazine/article/1996080/where-does-word-chop-come).

In 1677 the UK’s Statute of Frauds Act enunciated the legal principle that contracts had to be in writing to be enforceable. Today in Queensland,  the Property Law Act 1974 requires that only property contracts must be in writing and signed.

Basically a signature is a unique identifier of you. (‘Signing’ on websites via ticking or clicking through adds another dimension to the signature issue).

Why do we sign documents?

In law, a signature signals to a reasonable person that the signatory has read and agrees or approves the contents of a document.

Signatures can bind a party to a contract even if they have not read it (L’Estrange v Graucob affirmed in Toll v Alphapharm).

The Judgment

Back in Canada, Justice Timothy Keene searched worldwide for a case that considered what the emoji means; he consulted an online dictionary to discover:

The thumbs-up emoji is used to express assent, approval, or encouragement in digital communications, especially in Western cultures https://www.dictionary.com/e/emoji/thumbs-up-emoji/

Justice Keene spoke of the two purposes of signatures in this instance:

This court readily acknowledges that a 👍 emoji is a non-traditional means to “sign” a document but nevertheless under these circumstances this was a valid way to convey the two purposes of a “signature” – to identify the signator (Chris using his unique cell phone number) and as I have found above – to convey Achter’s acceptance of the flax contract. [63]

He noted the Courts have to keep abreast of communication as it becomes used in everyday life:

 The Court cannot (nor should it) attempt to stem the tide of technology and common usage” of emojis . . . This appears to be the new reality in Canadian society and courts will have to be ready to meet the new challenges that may arise from the use of emojis and the like [40]

After considering the circumstances of the case as a whole, Justice Keene ruled that:

on the balance of probabilities . . . Chris okayed or approved the contract just like he had done before except this time he used a thumbs up emoji. . . . In my opinion that meant approval of the flax contract and not simply that he had received the contract and was going to think about it. . . A reasonable bystander knowing all of the background would come to the objective understanding that the parties had reached consensus ad item – a meeting of the minds – just like they had done on numerous other occasions. [36]

So it was not just the emoji that bound Achter to the contract; it was that Achter had an established pattern of texting agreement and the emoji was accepted was another way of saying ‘yes I agree to supply flax to you’.

Because Achter failed to deliver the flax, the court ordered that he pay the value of the contract (CAD 82,200) to Mickleborough.

Even though this is a Canadian case, it signals to other courts a way to think about the interplay among  technology, language and communication.

Certainly, it is a reminder to be careful what you text when it relates to business matters. Do you mean “yes, I got your contract” or “yes, I agree to our contract”.

And that is another reason why it is essential to always seek legal advice before you sign or text or verbally agree to any contract.

Call us on 1300 334 566 or email info@bcglaw.com.au and safeguard your interests every step of the way- We are your legal problem solvers.