Introduction:

In most circumstances, a mere emoji will not be a binding acceptance of a contract, but in the recent matter of South West Terminal Ltd. v. Achter Land & Cattle Ltd.,[1] the Saskatchewan Court of King’s Bench found that the 👍 emoji bound a farmer to a commercial contract, costing him upwards of $80,000.

The simple act of pressing send on a text message containing only the 👍 emoji was found to be sufficient to bind the farmer to the contract, and when the farmer failed to perform the duties agreed upon, he was ordered to pay $82,200.21 in damages for breach of contract.

At first glance, this decision seems novel and outlandish. However, it is a natural evolution of the principles of common law contracts keeping up with modern communication methods.

Background:

The plaintiff in this matter is South West Terminal LTD. (“SWT”), a grain and crop inputs company. The defendant, Achter Land and Cattle LTD. (“Achter”) is a farming corporation owned by Chris Achter.

Leading up to the dispute between these two parties, SWT had purchased grain from Achter on several occasions, dating back to 2012. They regularly dealt with one another through text exchanges, with SWT sending photos of contracts to Achter’s cell number for acceptance. Achter would reply to the contracts with texts such as “yup”, “ok”, or “looks good”. Achter would always fulfill the contract following these exchanges.

For the contract at issue, SWT sent Achter the contract through text for the purchase of 86 metric tonnes of flax. Achter replied with a 👍 emoji, which SWT reasonably interpreted as acceptance. Achter did not deliver the flax by the date stipulated for in the contract, and SWT brought an action against them for breach of contract.

Common Law of Contract Formation:

The parties disagree as to whether there was a “meeting of the minds”, which is the basis of any legally binding contractual obligation. In its analysis, the Court relied on the matter of Ethiopian Orthodox Tewahedo Church of Canada St. Mary Cathedral v Aga,[2] a case in which the Supreme Court of Canada reaffirmed well-established common-law contract principles. In that case, the Supreme Court of Canada set out that the determination as to whether there has been a meeting of the minds must be assessed on an objective basis. In other words, how would each party's conduct appear to a reasonable person in the position of the other party? The legal test for agreement to a contract is whether the parties have indicated to the outside world, in the form of the objective reasonable bystander, their intention to contract. The question is not what the parties subjectively had in mind, but, rather, whether their conduct was such that a reasonable person would conclude that they had intended to be bound.

Verdict:

Achter argued that the emoji he sent only signified that he received the contract, not that he accepted it. The Court rejected this argument because (1) in the past, he had accepted contracts with text messages; and (2) because the 👍 emoji’s definition is conducive to acceptance per its dictionary definition. The Court noted that the dictionary meaning of the thumbs up emoji is meant to express assent, approval, or encouragement in digital communications, especially in western cultures.

The court found that the legal requirement for a reasonable bystander was met by Achter sending the 👍 emoji. Regardless of what Achter had in mind when sending the 👍, an outsider would understand it to be acceptance per his past behaviour. A bystander, knowing all the background of the two parties, would come to the objective understanding that the parties had reached a meeting of the minds just like they had done in their past dealings.

Since Achter agreed to the contract but did not deliver the flax, he was found liable for breach of contract, and was ordered to pay $82,200.21 in damages.

Conclusion:

Although the use of an emoji as acceptance for a contract is novel, the legal principle that the court relied on in its decision is not. Emojis are a modern form of communication, and as such, are subject to established common law principles.

Looking Forward

Context is everything – not all emojis or even all 👍 will be considered acceptance. Because the farmer had acted on past contracts by sending short text messages, both parties understood the emoji as acceptance and as confirmation that the farmer will act.

The biggest takeaway from this matter is to be consistent and clear with your intentions when entering into legally binding agreements. The best course of action to protect yourself from entering undesirable contracts is to make sure all dealings are conducted formally and in writing, with signatures and witnesses such that a reasonable bystander will understand that your emojis are not binding in any way. The only way to prevent such a situation from occurring would be to refrain from using emojis in business contracts 🖋️ 📑. It could save you or your business thousands of dollars 💲.