Lower Court Holds That E-mails May Constitute A Binding Purchase And Sale Agreement

A Superior Court Judge recently ruled in Feldberg et al. v. Coxall that a series of e-mails between a buyer and seller of real estate that include the material terms of the offer and an acceptance of those terms may create an enforceable purchase and sale agreement.  The seller, who withdrew from the transaction, filed a motion to dismiss the buyer’s complaint on the grounds that the alleged agreement between the parties did not satisfy the statute of frauds requirement (G.L. c. 259, §1) that contracts for the sale of property be in writing and signed by the parties. 

Judge Douglas H. Wilkins denied the seller’s motion stating that “[t]he parties conduct here in using e-mail to conduct negotiations in this case arguably constitutes an agreement to conduct transactions by electronic means.”  In reaching his decision, Judge Wilkins noted that while “the Courts have not yet set forth rules of the road for the intersection between the seventeenth-century statute of frauds and twenty-first century electronic mail,” the Uniform Electronic Transactions Act (G.L. c. 110G, §5), which applies to transactions between parties that have specifically agreed to conduct transactions by electronic means, “is one attempt to do so.”  Accordingly, Judge Wilkins ruled that whether there was such an agreement here is to be determined from the surrounding circumstances and the actual conduct of the parties.  Accordingly, Judge Wilkins denied the seller’s motion to dismiss the buyer’s claim based upon the statute of frauds defense.

While this lower court ruling certainly does not establish binding precedent, it gives cause for concern for both buyers and sellers of real estate to think twice before hitting the send button.  Although the parties may not have put pen to paper in the form of a formal executed purchase and sale agreement, their email exchanges may nevertheless create an enforceable contract.

About Bob Gibbons

Bob is a partner in the Litigation Group and currently concentrates his practice in commercial litigation where he handles a broad range of business matters involving commercial contracts, banking, construction, commercial landlord-tenant disputes, complex collections and fiduciary fraud. Before joining the firm, he was a program manager for General Electric Aircraft Engines. Bob serves as litigation counsel for a variety of local and national companies, including banking and financial institutions, manufacturing companies, construction companies and professional service firms. He works with clients to create efficient and cost-effective resolutions of commercial problems thereby maximizing client recovery.
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2 Responses to Lower Court Holds That E-mails May Constitute A Binding Purchase And Sale Agreement

  1. Pingback: Did I just create a contract? | Business Registration Office

  2. reggie says:

    This is very interesting, and something that people should indeed keep in mind. It would be very prudent to be extremely cautious of what you say in emails and be sure that your intent is expressed exactly as you mean it to be.

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