Will your thumbs-up (👍) emoji get you sued?

The Canadian court has recently made a judgment that overturned our prior understanding of what suffices to an acceptance of an offer to result in contract formations. This ruling is of utmost relevance due to the new social norm of increasing use of online platforms as a means of communication as a result of the Covid-19 pandemic, and this practice has been carried on until today. In this case, the use of a thumbs-up ( ) emoji has complicated what seems like a basic contract formation to a not so straight-forward case. In the words of MLT Aikins LLP partner Josh Morrison, whose firm handled the case for the plaintiff, “It’s basic contract formation. And then layered over it are the Sale of Goods Act, the Electronic Information and Documents Act, and common law issues. It had some unique wrinkles.[1]” In this article, we will unfold these “wrinkles” and explore all the relevant factors which influenced the Judge in reaching this decision.

The claimant, South West Terminal (SWT), intended to purchase flax from the defendant, Achter Ltd (Achter), where the latter is to 87 metric tonnes of flax for a contracted price of $669.26 per tonne, with delivery between November 1, 2021 and November 30, 2021.

The contract was discussed between SWT’s representative, Kent, and Achter’s representative, Chris. Upon their discussion, a contract was drawn up and signed by SWT and sent to Chris, followed by the phrase “Please confirm flax contract”. Chris replied to the photo of the contract with a thumbs-up ( ) emoji, which was subsequently being interpreted by SWT as an acceptance of their offer.

The long and short of it is that Achter did not deliver any flax. SWT then sued for a breach of contract.

The contentious point here is whether a thumbs-up ( ) emoji sufficiently amounts to acceptance of a contract given that it is rather informal way of concluding a contract.

Judge Justice Timothy Keene concluded that a thumbs-up ( ) emoji constitutes an electronic signature and thus amounts to an acceptance of a contract.

In reaching this decision, the usual legal guidelines for a contractual formation were considered. Firstly, the contract’s validity is judged objectively by assessing the intentions of the parties. The court will consider whether an objective, reasonable bystander who is aware of all the relevant facts would conclude that there is a meeting of the minds between two parties and thus results in a contractual agreement. In doing so, the courts are not restricted to the four corners of the purported agreement but is allowed to take into consideration the surrounding circumstances.[2] The surrounding circumstances or factual matrix include facts that were known or reasonably capable of being known by the parties when they entered into the written agreement.[3] The intention of parties to enter into a contract is also judged by the nature and relationship of the parties and the interests at stake.[4]

In this present case, SWT and Achter have a long-standing relationship, whereby approximately 15 to 20 contracts have been concluded between the parties.[5] Upon examining the previous course of dealings, there was an uncontested pattern of Achter approving orders by replying to the photo of the contract texted to them. In previous settings, Achter’s representative usually accepted it using phrases such as “Looks good”, “OK”, and “Yup”. Just like the previous transactions, Judge Keene held that the use of a thumbs-up ( ) emoji in this transaction is equivalent to the one-word phrases used. Judge Keene reasoned this by citing the definition of the thumbs-up emoji from the online dictionary–Dictionary.com which states that: “it is used to express assent, approval or encouragement in digital communications, especially in western cultures.”[6]

At this juncture, it would be apt to observe Achter’s counsels’ arguments.  He has no dispute with the definition of the thumbs-up ( ) emoji. However, he argued that the thumbs-up ( ) emoji reacted by Achter’s representative is merely an assent to the picture of the contract, and not the full contract itself. As Chris mentioned in para 8 of his affidavit, the thumbs-up emoji does not constitute a digital signature to assent to the contract and it was merely an indication to the plaintiff that his text message was received.[7] In addition, Achter went further to claim that the thumbs-up emoji is different from an actual signature which confirms the person’s identity.[8]

However, as Judge Keene delved deeper into observing the parties' previous course of dealings, the fact that Achter in their previous contracts accepted the offers by using one-word replies serves as an indicator that parties understood that this amounts to an agreement and not just acknowledgment of the receipt of the contract.[9] Citing Judge Keene, “In short, what we have is an uncontested pattern of entering into what both parties knew and accepted to be valid and binding deferred delivery purchase contracts. 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.”[10] Likewise, the thumbs-up emoji used in this particular transaction is no other different than the previous cases where a one-word affirmation was given by Achter’s representative.

With regards to the Achter’s counsels’ argument which called for an actual signature for a better identification of the signing parties’ identity, Justice Keene held that this is not a pre-requisite. His Lordship referred to Section 18 of the Electronic Information and Documents Act, 2000 ("EIDA") in confirming that a thumbs-up emoji comes under “an action in electronic form” which is recognised by this legislation to amount to a legally enforceable assent.[11] To further support this, Justice Keene referred to the case of Quilichini v Wilson’s Greenhouse whereby the court held that the customer has consented to the go-kart waiver document by clicking the “I agree icon” icon and that amounts to an electronic signature.[12]

Though the usage of the thumbs-up ( ) emoji has not been widely discussed in Malaysian Courts, some wisdom can be garnered from the United States (US), where the Courts took a varied approach therein.  In Lightstone v. Zinnex,[13] the Court did not approve the thumbs-up emoji as a signature since there is no previous course of dealings between parties and based on the text messages exchanged between parties, thus no indication of the meeting of the minds between both parties.

Similarly, in Bardales v. Lamothe,[14] the thumbs-up emoji used in the communication of two estranged couples does not amount to formal consent from one parent to allow the child to relocate permanently overseas. This is due to the lack of surrounding context to this conversation the court is unable to affirm that the thumbs-up emoji used in this context sufficiently amounts to an assent.

It can be observed that whether or not the thumbs-up ( ) emoji will sufficiently constitute a digital signature is decided on a case-to-case basis.  In persuading the court to not allow this contract to stand, Achter’s counsels pointed out their concern that such a decision will open up floodgates since parties may now come forward to ask the court to interpret the meanings of different emojis.[15] Given the plethora of emojis both in existence currently and yet to be invented, it is not surprising if the court will be inundated with the task of interpretation. This is made complicated as an emoji which is represented by a graphic does not have a universal meaning and is subject to various interpretations. For instance, an article by one Eric Godman pointed out that it might pose a negative connotation, for example, Gen Z individuals may find it to be passive-aggressive.[16] This will no doubt result in great uncertainties.

On a concluding note, we personally find that Judge Keene’s judgment satisfactory, and we believe this is a brave step taken despite it being a contentious element that might surface in the future. Courts should not disregard or go even further to resist the trend of the role played by technology in communication. However, given that a seemingly casual indication of acceptance can now lead to a binding contract depending on the context, contracting parties are advised to be more cautious when communicating their intentions. Of course, it is best to have clear communication in writing to minimize disputes. 

Bibliography

Cases

1. Ethiopian Orthodox Tewahedo Church of Canada St. Mary Cathedral v Aga, 2021 SCC 22
2. Quilichini v Wilson’s Greenhouse, 2017 SKQB 10
3. Saskatchewan Ltd. v Mossing, 2022 SKQB 193
4. South West Terminal Ltd v Achter Land Ltd, 2023 SKKB 116
5. Lightstone RE LLC v Zinntex LLC, 2022 N.Y. Misc. LEXIS 5925 (N.Y. Supreme Ct. Aug. 25, 2022)
6. Bardales v. Lamothe, 2019 U.S. Dist. LEXIS 186273 (M.D. Tenn. Oct. 25, 2019)

Websites/blogs

1. Josh Morrison , Danielle Graff , Kristél Kriel , Michael Marschal and Jeremy Barber, ‘Court finds “thumbs-up” emoji can constitute an electronic signature’, (Mondaq, 23 June 2023), <https://www.mondaq.com/canada/contracts-and-commercial-law/1333264/court-finds-thumbs-up-emoji-can-constitute-an-electronic-signature> last accessed 6 July 2023
2. Emily Hinkley, ‘Thumbs up emoji valid acceptance of contract, says Canadian court’, (Legal Check, 4 July 2023), <https://www.legalcheek.com/2023/07/thumbs-up-emoji-valid-acceptance-of-contract-says-canadian-court/ > last accessed 6 July 2023
3. Eric Goldman, ‘A Thumbs-Up Emoji Costs a Canadian Seller $82,000–South West Terminal v. Achter Land’, (Technology and Marketing law blog, 2 July 2023) <https://blog.ericgoldman.org/archives/2023/07/a-thumbs-up-emoji-costs-a-canadian-seller-82000-south-west-terminal-v-achter-land.htm> last accessed 6 July 2023
4. Zena Olijnyk,‘Thumbs up emoji constituted acceptance of contract, Saskatchewan court rules’ (Canadian Lawyer, 28 June 2023), <https://www.canadianlawyermag.com/practice-areas/corporate-commercial/thumbs-up-emoji-constituted-acceptance-of-contract-saskatchewan-court-rules/377287 > last accessed 6 July 2023