Can sending the thumbs-up emoji result in a binding contract? While seemingly far-fetched, this question lies at the heart of the recent Saskatchewan case: South West Terminal Ltd. v Achter Land, 2023 SKKB 116. The following is a brief overview of the key details of the case.
Facts
South West Terminal Ltd. (SWT) is a grain and crop inputs company based in Gull Lake, Saskatchewan. They had been purchasing grain from Achter Land & Cattle Ltd. (Achter), a farming corporation owned by Chris Achter and incorporated in Swift Current, Saskatchewan. Chris served as the primary representative for Achter, though his father, Bob Achter, was sometimes involved in negotiations.
In March 2021, Kent Mickleborough, a Farm Marketing Representative for SWT, sent a text message to producers, including Bob Achter and Chris Achter, stating the price for flax. Following the message, Mr. Mickleborough spoke with Bob Achter and later contacted Chris Achter. A contract was drafted for Achter to sell SWT 86 metric tonnes of flax at a price of $17.00 per bushel, with delivery scheduled for November. Mr. Mickleborough signed the contract and sent a photo of it to Chris Achter, who responded with a “👍” emoji.
However, Achter failed to deliver the 87 metric tonnes of flax to SWT in November 2021. By the end of November, the spot price for flax had risen to $41.00 per bushel.
Ultimately, the key issue is whether the thumbs-up emoji was a form of acceptance such that the contract was valid and binding.
Law
In his written decision, Justice Keene notes the well-established requirement for a contract to be binding: there must be a meeting of minds. A contract is only formed when one party makes an offer that is accepted by the other party, with the intention of establishing a legal relationship and supported by consideration.
In determining whether there has been an acceptance of an offer, the court considers the issues objectively. This means assessing how the conduct of each party would be perceived by a “reasonable person” in the position of the other party. So the focus lies not on the subjective intentions of the parties but on whether their conduct would lead a reasonable person to conclude that they accepted the offer and intended to be bound. In assessing this question, the court can consider the surrounding circumstances and is not limited to the explicit terms of the alleged agreement.
The Decision
Justice Keene noted that the parties had a consistent pattern of entering into purchase contracts in a somewhat casual manner. Each time, Kent, representing South West Terminal Ltd. (SWT), would make offers using language such as “Please confirm terms of durum contract,” to which Chris Achter, representing Achter Land & Cattle Ltd., responded with brief affirmations such as “looks good,” “ok,” or “yup.” These responses were understood by both parties as confirmation of the contract and not merely an acknowledgment of its receipt.
While Achter attempted to argue that a physical signature is necessary to confirm acceptance of an agreement, the court disagreed, stating that a modern-day emoji, such as the 👍, can serve the same purpose as a traditional signature. For Justice Keene, a reasonable person receiving the emoji and who had participated in previous contracts where the acceptance was brief and casual would have understood that the contract had been accepted. The use of the 👍 emoji was, therefore, capable of conveying acceptance. Considering all the circumstances, the court concludes that Chris’s use of the 👍 emoji was indeed an approval of the flax contract, similar to their previous interactions, and that Achter was in breach of contract.
Because Achter breached the contract, Justice Keene awarded damages in the amount of $82,200.21 payable to SWT.
Summary
This case is yet another example of how case law can be stranger than fiction. As a result of sending the thumbs-up emoji (and because of their previous dealings), Achter became liable to pay $82,200.21 in damages. That is an expensive emoji! 👍