E-mails about a contract could be considered binding, law firm Webber Wentzel said on Thursday.<\/p>\n
The firm referred to a Supreme Court of Appeal (SCA) ruling last month that found e-mail negotiations and typed e-mail signatures binding.<\/p>\n
“Given the pervasive use of e-mail in the workplace and in commercial interactions it is important to exercise caution,” Webber Wentzel technology, media, and telecommunications head Robby Coelho said.<\/p>\n
The SCA judgment on November 21 saw it uphold an appeal by Spring Forest Trading against Wilberry (Pty) Ltd.<\/p>\n
The companies had agreed that Spring Forest would lease mobile dispensing units from Wilberry for use in its car wash business.<\/p>\n
They signed agreements with clauses providing that cancellation could only be made in writing and signed by both parties.<\/p>\n
When Spring Forest could no longer meet its rental commitments the parties met on February 25 last year and agreed to cancel their agreements.<\/p>\n
The terms of the cancellation were recorded in an e-mail exchange and the names of the parties appeared at the bottom of each e-mail.<\/p>\n
Spring Forest then entered into a similar business agreement with another entity. Wilberry approached the Durban High Court to interdict its business pending an application for breach of contract.<\/p>\n
The high court granted the interdict and Spring Forest appealed to the SCA.<\/p>\n
The SCA upheld the appeal on the basis that contracts could consensually be cancelled via e-mail, and referred to provisions of the Electronic Communications and Transactions Act (ECTA).<\/p>\n
It found the ECTA’s requirement for an “advanced electronic signature” did not apply to private agreements but rather to cases where a statute or law required a signature.<\/p>\n
Thus, names typed at the end of e-mails constituted electronic signatures in private agreements.<\/p>\n
Coelho said the ruling could have broader implications for agreements where notice or consent had to be given in writing.<\/p>\n
The principles could also extend to correspondence through other technologies such as text messages.<\/p>\n
He recommended that contracts should expressly regulate whether electronic communications were permitted, to avoid disputes.<\/p>\n
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