THUMPS UP EMOJI – A VALID ACCEPTANCE OF A CONTRACT (SOUTH WEST TERMINAL (SWT) V. ACHTER LAND & CATTLE LTD 2023 SKKB 116)

INTRODUCTION

A Canadian judge has declared in the case of South West Terminal (SWT) v. Achter Land & Cattle Ltd. that a thumbs-up emoji can be regarded as a valid signature and utilized to engage in binding legal transactions.

This article examines the facts of the case, the parties arguments, and the Court's reasoning for its conclusion.

FACTS

A dispute arose between a farmer, Chris Achter, and a grain processing cooperative in southwestern Saskatchewan. During the covid-19 pandemic in 2020, the grain cooperative stopped sending its salespeople to deal with farmers face-to-face and instead handled contracts by phone or email.

The cooperative claimed that both parties entered a deferred delivery purchase contract for 87 metric tons of flax in 2021, with an agreement to pay 669.26 Canadian dollars (about $500) per ton.

According to court records, a cooperative employee drafted a contract that listed “Nov.” as the delivery period, signed it, and took a photo of it on his cell phone. He then sent it to Achter, along with the phrase “Please confirm flax contract.” In response, Achter texted back a thumbs-up emoji.

But Achter did not deliver the flax in November – and by that time, prices for the crop had increased. This prompted the cooperative to sue for breach of contract and insist that the emoji constituted an agreement.

ARGUMENT OF PARTIES

In a deposition, Achter countered that he had not meant the emoji to function as a signature. In his words:

“I confirm that the thumbs-up emoji simply confirmed that I received the flax contract,” Achter said. “It was not a confirmation that I agreed with the terms of the Flax Contract. The full terms and conditions of the Flax Contract were not sent to me, and I understood that the complete contract would follow by fax or email for me to review and sign………… I deny that he accepted the thumbs-up emoji as a digital signature of the incomplete contract,” Achter said in the deposition. I did not have time to review the Flax Contract and merely wanted to indicate that I did receive his text message.”

Achter added that he regularly texted back and forth with the salesperson, and many of those texts were informal. As supporting evidence, he presented texts showing a joke that the salesperson had previously sent him.

SWT on the other hand, pointed to previous contracts confirmed by text message, suggesting the emoji meant Achter was agreeing to the terms of the contract.

COURT’S FINDINGS

The Court stated that the instant case is peculiar given the way the alleged acceptance was conveyed. Hence the Court had to determine whether there existed a valid contract between SWT and Achter.

?The Court noted that the test for the validity of a contract is whether the parties have indicated to the outside world, in the form of the objective reasonable bystander, their intention to contract and the terms of such contract.

The Court pointed out that in past communications between Kent and Chris, there was an uncontested pattern of entering into what both parties knew and accepted to be valid and binding deferred delivery purchase contracts on several occasions.

The Court further noted that each time Kent added to the offered contract “Please confirm terms of durum contract” Chris did so by succinctly texting “looks good”, “ok” or “yup”. The parties clearly understood these curt words were meant to be confirmation of the contract and not a mere acknowledgment of the receipt of the contract by Chris.

In the words of the Judge:

“There can be no other logical or creditable explanation because the proof is in the pudding. Chris delivered the grain as contracted and got paid. There was no evidence he was merely confirming the receipt of a contract and was left just wondering about a contract”.

Delving into the meaning of emojis, the Court stated that the dictionary meaning of ?? emoji is that it is used to express assent, approval, or encouragement in digital communications, especially in Western cultures.

The Court was of the view that on a balance of probabilities, Chris okayed or approved the contract just like he had done before except this time he used a ?? emoji. Consequently, the Court ordered Asher to pay C$82,000 ($61,442) for an unfulfilled contract.

ANALYSIS

This judgment further confirms that contracts can be accepted electronically as opposed to the conventional way of acceptance, even though seemingly informal methods such as emojis are implored.

For a contract to be valid, it must generally contain all of the elements of a contract namely, offer, acceptance, consideration, and intention to create legal relations. Once these elements are present, the subjective intentions of the parties hold no legal weight when determining the validity of a contract. Instead, the validity is assessed by considering the intentions of the parties from the viewpoint of a reasonable and objective bystander who possesses all relevant information that the contracting parties are privy to.

Hence, if a reasonable and objective bystander would interpret sending an emoji as acceptance of a contract, the parties may be bound by the terms of the contract, regardless of the unconventional method of acceptance.

It is thus imperative to ensure clarity in written communication to prevent disputes and ensure that all parties have a clear understanding of their respective contractual obligations. ?