What you say on email can be a binding contract

Last week, the New York Times reported on a court appeal regarding email communications. I sent the link to one of my clients, who was in a transaction with a seller, and a seller’s agent, and a seller’s attorney who did not understand the importance of email communication.

Here’s what happened:

The seller and the buyer had email communications through their agents regarding chattel (personal items) and some built-in items that could stay or go after closing. In the course of that conversation, the seller offered two small mounted TVs. The TVs were a distraction from the negotiation at hand. My client, the buyer, frankly didn’t care if they stayed or went. A deal was reached regarding some other, more expensive, items; the more expensive items were included, specifically, in the Purchase and Sales Agreement.  

However, the fur started to fly when -- several weeks later -- those same TVs were offered, for a fee, along with some items that were clearly built-in and part of the property. When I explained to the seller’s agent that these TVs had already been offered, agent said that offer was not binding because it was not in the Purchase and Sales Agreement. My client was annoyed that the seller was going back on his word. My client was also annoyed that the seller was attempting to sell built-in items at the last minute. 

“Not in the Purchase and Sales Agreement” does negate the written offer, by email, to my client. As of last week -- at least in New York State -- email promises are confirmed as binding. “As much as communication originally written or typed on paper, an e-mail retrievable from computer storage” is proof of a deal, according to the court’s opinion, which was written by Associate Justice David Friedman.

The Times, quotes an attorney who is using a disclaimer to avoid email backfires:

In most cases a disclaimer can inoculate senders from having e-mail backfire, real estate lawyers said. Mario J. Suarez, a lawyer at Thompson Hine who handles many commercial transactions, suggested that the wording might say the communications “shall not be deemed an offer, as no documents are binding unless and until executed.”

Should real estate agents have a disclaimer on all their emails? I vote, “no.” I like the idea of saying or writing what I mean and I don’t mind being held to my word.