IndyBar: Your Contract Law Final Meets the Texting Age

By Adam Christensen, Hearthside Food Solutions LLC

It’s mid-December and the end of the first semester of your 1L year. You’re exhausted but jittery, chasing last night’s midnight Red Bull with a Venti Americano and a backpack granola bar, flattened by hornbooks. Your bank app alert buzzes the phone in your pocket and you see that this month’s rent cleared, a poor investment as you’ve spent the past four weeks in one of two locations: the library, studying, or the library bathroom, trying not to cry (again).

You’re headed to your last final exam: contracts. In the hallway, you pull out your stack of bent, Cheetos-smudged flashcards. On them appear the names of seminal cases: Hawkins v. McGee, Hadley v. Baxendale, Harvey v. Facey. Each issued more than 100 years ago, before the internet, TV, airplanes, cars, the state of Arizona. You splash the cards into a nearby trash can as you enter the classroom, accepting your fate like a five-star QB drafted by the Browns — feigning resilience while inwardly hopeless.

“You may begin,” says your professor, with empathy laced with trace amounts of sadism.

Question 1 – In March, a Canadian farmer wishes to sell 87 tonnes of flax. His long-time buyer texts him an image of a contract to buy the flax at C$750 per tonne for November delivery. The contract is signed by the buyer, who includes with the contract a text reading, “Please confirm flax contract.” The farmer responds: “👍.” In November, the farmer does not deliver the flax, by which time the price has risen to C$1,600 per tonne. Describe in detail the legal implications of this interaction, citing references.

💩💩💩

In June, Judge Keene of the King’s Bench for Swift Current, Saskatchewan, issued a ruling on this exact fact pattern. The court, relying on the 1979 Sale of Goods Act as well as the parties’ past interactions wherein the farmer accepted similar contracts by responding with texts like “Yup” and “Sounds good, [eh]” held that while a 👍 “is a non-traditional means to ‘sign’ a document,” it nevertheless met the dual criteria of a traditional signature: to identify the signator and convey acceptance of the contract. The court awarded the flax buyer damages of C$82,000, the difference between the March and November flax prices.

Since then, the internet has done its thing, poking fun at the wacky world of law and, in so doing, its own convention of reverting written words back to hieroglyphics. And yet, however “LOL” the ruling may seem, its essence is settled enough both in traditional and more modern contract law.

“In many of these cases our traditional analysis of offer, counter-offer, rejection, acceptance and so forth is out-of-date. … As Lord Cairns L.C. said in Brogden v. Metropolitan Railway Co., (1877): ‘[T]here may be a consensus between the parties far short of a complete mode of expressing it, and that consensus may be discovered from [other sources] of an imperfect and incomplete description.’” Butler Machine Tool Co. Ltd. v. Ex-Cell-O Corp (England ) Ltd., (1977).

Professor Shawn Bayern of Florida State University goes on to argue, “[M]ost of the expression rules in contract-formation doctrine are unjustified and the law should move (and is moving) away from such rules and toward general principles of interpretation … that is, the ordinary legal construction of the parties’ intent.” “Offer and Acceptance in Modern Contract Law: A Needless Concept,” 103 Cal. L. Rev. 67, 73 (2015).

“Time’s up,” says your professor.

You stand dazed, fingers cramped, vision blurred. Your phone buzzes in your pocket, a text from your classmate: “How’d it go?”

“🙌  ♂ 🥳  🍻,” you reply.•

Adam Christensen is an in-house attorney with Hearthside Food Solutions LLC. He’s a past president of the Indianapolis Bar Foundation and currently serves as treasurer for the IndyBar Association’s board of directors and as a member of the executive committee of the In-House Counsel Division.