In a current Massachusetts case (Feldberg v. Coxall, Middlesex Superior Court, CA No.12-1649-A), the judge ruled that an exchange of emails alone might satisfy the Statute of Frauds and suffice to create a binding purchase and sale agreement for the sale of real estate. While the court was not asked to decide the issue itself (i.e., did the emails in questions actually constitute a valid purchase and sale agreement), the court found that certain portions of the emails (such as the parties’ email signature blocks and even just the “from” line in the emails) “may” constitute electronic signatures under the Uniform Electronic Transactions Act (or UETA, M.G.L. 110G §7(d)). This could be the case, the court held, even for purposes of the Massachusetts version of the “statute of frauds”, which requires that agreements to transfer interests in real estate be written and signed by the party against whom they are to be enforced.
Since the Massachusetts enactment of the UETA (effective Feb. 24, 2004), there have been no cases in Massachusetts that addressed whether emails between parties could count as “signed” documents for purposes of the statute of frauds. As the Superior Court noted, quoting a 2010 Oregon decision, “In truth, the Courts have not yet set forth rules of the road for ‘the intersection between the [17th] century statute of frauds and [21st] century electronic email.”
UETA’s definition of “electronic signature” is very broad: “an electronic sound, symbol, or process attached to or logically associated with a record and executed or adopted by a person with the intent to sign the record.” The Feldberg court found that standard email signature blocks or “from” lines might meet this standard.
There are some simple steps that can be taken to reduce the risk that emails with standard signature blocks or “from” lines will unintentionally create binding contracts. For example, one can include in one’s standard email signature block a disclaimer stating that the email is not intended and shall not constitute an electronic signature giving rise to a binding legal contract, unless expressly stated otherwise in the body of the email by the sender.
This area of law is evolving, but one thing is clear – caution is required when conducting any sort of negotiations via email.
The authors, Peter Corbett and Lara Guercio, are members of the Goulston & Storrs Real Estate Group.
For questions regarding the information contained in this advisory, please contact:
Peter D. Corbett
Lara D. Guercio
This advisory should not be construed as legal advice or legal opinion on any specific facts or circumstances. The contents are intended for general informational purposes only, and you are urged to consult your own lawyer concerning your situation and any specific legal questions you may have.
Pursuant to IRS Circular 230, please be advised that, this communication is not intended to be, was not written to be and cannot be used by any taxpayer for the purpose of (i) avoiding penalties under U.S. federal tax law or (ii) promoting, marketing or recommending to another taxpayer any transaction or matter addressed herein.
© 2012 Goulston & Storrs – A Professional Corporation All Rights Reserved