The idea of judges sometimes being a little behind the pace of modern life and terminology has been upended in a landmark Canadian ruling.
The Court of King’s Bench in the province of Saskatchewan found that a thumbs-up emoji in a text message exchange was enough to render a cargo contract valid.
The judgment came in the case of South West Terminal (SWT) versus Achter Land and Cattle.
The court accepted the emoji as a valid electronic signature.
UK law firm Watson Farley & Williams (WFW) said: “This judgment should be noted with caution by trading companies and other organisations whose personnel regularly discuss contract terms via informal communication methods, such as WhatsApp, Telegram or WeChat.”
SWT argued that the parties entered into a deferred delivery purchase contract on 26 March 2021.
Achter agreed to deliver 87 tonnes of flax for a contracted price of CAD 669.26 per tonne, but this never happened and the producer was sued.
SWT had texted a photo of the contract to an Achter representative Chris Achter, asking that he “please confirm”.
Achter texted back a thumbs-up emoji but argued in court that this was nothing more than an acknowledgement that the message from SWT had been received.
“The question before the court was not what the parties subjectively had in mind but rather whether their conduct was such that a reasonable person would conclude that the parties had intended to be bound,” WFW lawyers led by Sumeet Malhotra said.
The court noted that other contracts had been confirmed by Achter in texts with words like “looks good”, “ok” and “yup”.
‘Action in electronic form’
The judge ruled a thumbs-up emoji is an “action in electronic form”.
“This court cannot ... attempt to stem the tide of technology and common usage — this appears to be the new reality ... and courts will have to be ready to meet the new challenges that may arise from the use of emojis and the like,” the ruling said.
WFW said it is not uncommon in the fast-moving world of international commodity trading for traders to propose contract terms via informal channels.
“In the course of scrutinising such correspondence where disputes have arisen, we have also commonly seen the use of colloquial terminology by both parties’ personnel, including acronyms, slang and emojis,” the lawyers said.
“In view of this, we entirely agree with the court that similar cases ... will be seen in future, namely whether contracts have been validly formed by way of informal means.
“We strongly recommend that companies put in place clear policies as to how their personnel may communicate with counterparts.”
