A Sign Of The Times - When might your email sign-off bind you to a contract?

Commentary on the Case of Neocleous v Rees [2019] EWHC 2462 (Ch)

Background

The Claimants and the Defendant owned adjacent property whereby a waterfront parcel of the Defendant's property was only accessible on land by crossing the Claimants' property. A right of way was noted on the Defendant's relevant title but was not referred to in the Claimants' title documents.

In August 2016, the Defendant applied to change the register to add a right of way against the Claimants' title, to which the Claimants objected. It was in respect of settlement discussions by the respective solicitors on behalf of each of the parties that the present issue arose.

Email correspondence between the respective solicitors set out and confirmed the terms of settlement between the parties, following which the hearing was vacated. The specific emails in question had an automatic email sign-off which included the Defendant's solicitor's name and contact details. The Claimants' position was that this amounted to a binding contract of compromise in respect of which they sought specific performance. The Defendant contended that there was no enforceable contract and the terms had not been finalised.

The parties agreed that this involved the disposition of interests in land and that therefore it must satisfy the formalities required under the Law of Property (Miscellaneous Provisions) Act 1989. However, there were three main areas of disagreement in the pleadings: (i) whether the emails demonstrated contractual intention; (ii) whether the emails amounted to a "single document" incorporating all of the terms of the alleged agreement; and (iii) whether the signature requirement of the legislation was met. The Defendant conceded points (i) and (ii) at trial, leaving only the issue of whether the emails had been "signed".

How should "signed" be interpreted in these circumstances?

The court considered the approach in Firstpost Homes Ltd v Johnson [1995] 1 WLR 157, which was put forward by the Defendant, that a signature should be "handwritten (or at least a facsimile of such handwriting)". However, the court noted that this must be interpreted in the context of what an ordinary person believed the word "signed" to mean at a point in the past and that in the current age the understanding may differ.

The preferred approach was the test set out in J Pereira Fernandes SA v Mehta [2006] EWHC 813 (Ch), which was whether the name was applied for the purpose of giving authenticity to...