Verbal Agreement By Text
Can text messages replace both bilateral and unilateral agreements negotiated between one or more parties? Finally, some practical steps can be taken by companies to protect themselves from this potential vulnerability. If this is acceptable to both parties, a specific provision can and should be inserted into the draft treaty, which expressly states that the agreement can only be executed by a formal or physical signature, so that a name under an email or text is not enough.  A company could also include a practice of no longer manually entering names under emails or text messages or stopping using text messages during negotiations. The first case that appears to have sparked a discussion about text messages within the legal community is St. John`s Holdings, LLC v. Two Electronics, LLC.  In this case, the seller provided the buyer with an SMS confirming that a Memorandum of Understanding was acceptable and requested the buyer`s signature, but as soon as the buyer signed, the seller refused to execute the latest declaration of intent.  The Massachusetts Court held that „text messages and emails may comply with the Fraud Act, provided that, like other writings, they contain the essential terms of the transaction and are signed by the parties or their authorized agents.“  The St. John`s Holdings Court found that these conditions were met. The text message implicitly contained the Memorandum of Understanding and took into account all the essential terms of the contract.
The court then compared the text messages to the e-mail communication and found that the broker`s simple act, which inserted their first name at the end of the text message, was sufficient to qualify as a mandatory signature in these negotiations.  Text messages can also be used to negotiate and accept bilateral agreements. Bilateral contracts accepted by SMS, as in writing, have an offer, consideration, contractual capacity and acceptance. In 2016, St. John`s Holdings, LLC vs. Two Electronics, LLC created the precedent for text messages as valid legal documents. One of the repeated misunderstandings is that businesses and consumers tend to consider that if they have not signed a document, there is no possibility of being linked by an email or text message. Consumers and businesses are often quite surprised and, in some cases, worried when they learn that seemingly casual conversations containing a relevant language may be enough to create a legally binding contract or even a guarantee. A recording of an oral contract would therefore be useful in proving that there was an agreement, but would not change the fact that the contract is oral. Regardless of an oral or written agreement, the parties can argue over who said what and what they meant, and all that. These arguments will be available or unavailable under different legal doctrines, but the statue of fraud is the most common. The law of scams is a doctrine that tells us what types of agreements should be written (the acronym MY LEGS helps us, but I don`t answer them).
In other words, some oral chords are unworkable, even if you record it, in Full HD with 7.2 surround sound and the whole Church swearing on its testimonies. See Sawyer v Mills, Sup Ct KY 2009.