MO Chartered Services (Pty) Ltd
ELECTRONIC COMMUNICATION
EMAIL, Beware, you can contractually be bound based on data messages.
Today, the use of emails via smartphones and laptops is now pervasive. Even in business, people tend to reply to email messages without giving due consideration as they would do when signing a contract on hard paper. Well, if you were doing this, we advise you take a closer look at what you say in those email for you may be varying your contract inadvertently to your detriment. It’s not surprising that you will find a non-variation clause in contracts which provides that no variation or consensual cancellation would be effective unless reduced to writing and signed by both parties. Section 11.(1) of the Electronic Communication and Transaction Act 25 of 2002 (ECTA) says, information is not without legal force and effect merely on the grounds that it is wholly or partly in the form of a data message. Section 12 then went on further to say, a requirement in law that a document or information must be in writing is met if the document or information is in the form of a data message and accessible in a manner usable for subsequent reference. What the law is saying is that your loose email or SMS about a term of your contract could actually vary your contract. You may not believe this but this is factually true. Don’t take our word for it but instead take the Supreme Court of Appeal’s (SCA) ruling in Spring Forest Trading 599 CC v Wilberry (Pty) Ltd t/a Ecowash and Another (725/13) [2014] ZASCA 178 (21 November 2014). The SCA considered whether e-mail exchange met the standard requirements for variation clauses to contracts to be ‘in writing’ and to be ‘signed’. It ruled that emails satisfy these requirements. It further found that the onerous requirements of “advanced electronic signature” imposed by the ECTA did not apply to private agreements, but only in instances where a statute or law required a signature. As such, the typewritten names which we normally put at the foot of our emails to identify ourselves is sufficient to satisfy the requirements of the non-variation clause and will constitute an “electronic signature” in terms of ECTA. Be advised, consult with professionals when concluding agreements such that you will not be trapped into such pitfalls. It is advised that you specifically deal with the validity of electronic communication when concluding agreements and MO Chartered Services is here to assist, give us a call.