Canada: Court finds "thumbs-up" emoji can constitute an electronic signature

On June 8, 2023, the Court granted a summary judgment decision in favour of a grain buyer ("the Buyer"), after concluding that a thumbs-up (πŸ‘) emoji constituted acceptance of a contract.

Is allowance instantly strangers applauded

A recent decision from the Court of King's Bench for Saskatchewan, Canada may lead to some businesses thinking twice before using emojis.

On June 8, 2023, the Court granted a summary judgment decision in favour of a grain buyer ("the Buyer"), after concluding that a thumbs-up (πŸ‘) emoji constituted acceptance of a contract.

The facts

After discussing and agreeing to a flax contract over the phone, a representative for the Buyer texted the representative for the grain seller (the "Seller") a photo of the flax contract on March 26, 2021, along with the text message: "Please confirm flax contract." The Seller's representative texted back a thumbs-up emoji, which the Buyer understood to be the Seller's acceptance of the contract. However, the Seller failed to deliver the flax.

Prior to the dispute, the parties had a longstanding business relationship. They had previously entered into a number of similar contracts in a similar manner, with a photo of the contract being texted to the Seller, which would then be accepted via text message. The Seller had always accepted those contracts by text message using short affirmative phrases such as: "Looks good," "OK," and "Yup."

Accepting a contract

To form a contract, there must be an offer by one party that is accepted by another party with the intention of creating a legal relationship. The test for agreeing to a contract for legal purposes is not whether the parties to the contract subjectively believed they were entering into a contract. Instead, it is whether an objective, reasonable bystander would come to the conclusion that the parties had entered into a contractual agreement.

The Court found that when the Seller replied with the thumbs-up emoji, a reasonable bystander aware of the context of the situation would conclude that the Seller accepted the terms and obligations of the contract and intended to be bound by them. The Court was satisfied that in sending a thumbs-up emoji the Seller continued the pattern of acceptance, which included past acceptance of contracts by simple affirmative phrases sent in text messages. The Court held that the Seller agreed to the flax contract, and subsequently breached the contract by failing to deliver the flax.

In determining that the Seller accepted the contract using the thumbs-up emoji, the Court also relied on sections of the country's Electronic Information and Documents Act, 2000 ("EIDA"), which provides that acceptance of an offer can be expressed by an action in electronic form. The Court recognized the thumbs-up emoji as an electronic form of action capable of expressing acceptance, as contemplated under section 18 of the EIDA.

The Court also found that the thumbs-up emoji sent from the Seller's unique cellphone number met the legal requirements for an enforceable contract under section 6 of the country's Sale and Goods Act ("SGA"). Section 6 of the SGA provides that a contract for the sale of goods needs to be in writing and signed by the parties to be legally enforceable.

The Court again turned to the EIDA, which allows for the legal recognition of documents in electronic format when legislation requires a "signature" and when documents are to be "in writing." Section 14 of the EIDA acknowledges an electronic signature as valid when a signature is required by law. The Court accepted the Seller's use of the thumbs-up emoji as a valid electronic signature that met the requirement imposed by section 6 of the SGA.

Implications for organizations and individuals

This decision emphasizes the importance of recognizing that acceptance of contracts can be expressed electronically, even through seemingly casual means such as an emoji, depending on the context. It is a reminder that the subjective intentions of parties are irrelevant when determining a contract's validity at law. 

A contract's validity is determined by assessing the intentions of the parties from the perspective of a reasonable and objective bystander who is aware of all the relevant facts. If a reasonable and objective bystander would view sending an emoji as acceptance of a contract, the parties may well be held to their promises in the contract despite the unconventional means of acceptance. Ultimately, clarity in written communication is key to avoiding disputes before they happen and ensuring all parties have a clear understanding of the respective contractual obligations they are undertaking – and of whether a contract exists at all