In the recent case of Neocleous v Rees the High Court held that a contract for the sale of land was concluded electronically by email correspondence between two solicitors.
In this case, the Claimant had offered to settle a land dispute for £175,000 which had initially been accepted over the telephone.
The Defendant’s solicitor then emailed the Claimant’s solicitor confirming terms of the settlement between their respective clients, to which he replied confirming his agreement.
The Defendant later applied to have the case re-listed and stated that the terms of the settlement were yet to be finalised.
The High Court had previously ruled that an auto-generated footer had not amounted to an electronic signature and to sign an email active steps must be taken to insert their name manually.
In this particular case, the solicitor had set a rule in Microsoft Outlook that automatically added his name and title to all outgoing emails and therefore he had taken active steps to insert his name into the email.
The Court held that, in order for a contract to be signed, a wet ink signature is not required. As the Law Commission had suggested, what was required was that a name is added with authenticating intent. The fact that a signatory’s name was added automatically to the email did not prevent there being an authenticating intent. The sender of the email was aware that his signature was being added.
This case highlights the need to ensure that correspondence between solicitors is marked “subject to contract”, where appropriate, to prevent contracts arising in correspondence between solicitors. With the informal nature of emails, this is often easy to overlook.
For more information on anything covered in this article, please contact a member of our Company and Commercial Law team by email at info@ramsdens.co.uk or call 01484 821 500.