Are Emoji’s legal binding?

Introduction

Emojis originated in Japan in the 1990’s and, within 10 years, had become widely used and circulated by the likes of Google and Apple. Indeed, it is now estimated that more than ten billion emojis are sent worldwide every day!

Originally intended as a ‘bit of fun’ and as a means of communicating and conveying ideas or emotions without text, the use of emojis has rapidly infiltrated the commercial world – with some unintended consequences!

Can a contract be formed by Emoji?

There is a growing body of caselaw which confirms that a legally binding contract can be formed based on an Emoji.

So, how can this happen?

First, we need to consider some basic principles of English law and contract formation.

Commercial contracts (with a few exceptions) do not need to be in writing to be valid. Indeed, they can be written, oral, or a mixture of the two. Further, English law presumes that, once two businesses have reached an agreement, they intend to be legally bound by it.

For a contract to be legally binding, several elements must be present; offer, acceptance, consideration (the price of the contract), intention to create legal relations, capacity (the ability to contract) and legality.

So where does the use of emojis arise?

In practice, commercial negotiations are conducted in several ways – face to face, via Teams or Zoom, by email or, as is becoming more common place, through more informal channels such as SMS and WhatsApp.

The use of emojis and the risk of accidentally entering into a contract, arises at the offer and acceptance stage, particularly the latter.

Over time, with changing technology, the law has moved on from recognising a ‘wet ink’ signature as an acceptance of an offer.
Automatically, generated electronic signatures are now recognised …as are emojis!

A groundbreaking case

In a 2023, Canadian case (South West Terminal Ltd v Achter Land and Cattle Ltd) the issue really came to prominence. In what was believed to be the first ever reported case, a Judge held that a ‘thumbs up’ emoji amounted to the acceptance of a contract.
The facts were straightforward. The parties had been negotiating the sale of an agricultural commodity (Flax). Following a series of conversations, South West drafted a sale contract, signed it, photographed it and sent it, by SMS, to Achter with the message “Please confirm Flax contract”.

Achter responded with a ‘thumbs up’ emoji, which South West took to mean acceptance of the contract. Subsequently, Achter failed to complete the contract and South West sued for damages.

Achter’s defence was very straightforward – the emoji was not an acceptance of the contract. Therefore, there was no contract and no claim for damages could be brought. South West argued that the ‘thumbs up’ emoji constituted an acceptance. The Judge agreed!

In reaching his decision, the Judge had regard to the fact that the parties had a previous course of business dealing, with Acher agreeing to contracts in a very informal way – the words “Ok”, and “Yup” had been used by them in the past. The Judge felt that the ‘thumbs up’ emoji conveyed a sufficiently similar message and, having consulted an online dictionary, noted that a ‘thumbs up’ was a way of expressing approval.

Similar cases have now arisen in the English courts and a thumbs up emoji has been held to amount to acceptance.

Problems

“At their worst, emojis can convey a set of meanings far from, and potentially even the opposite of, their intended meaning” (Article from Baylor University on World Emoji Day).

The difficulty with emojis is that there is no universal consensus as to what each emoji means. Indeed, emojis are very likely to have different meanings to different people and within different cultures. For example, in China, a smiley face has been interpreted as conveying a mocking attitude. Further, if the sender and receiver do not use the same software then the readers device may visualise the emoji in a completely different way.

Whilst a ‘thumbs up’ can potentially be taken as an acceptance of a contract, this will very much depend on the facts of each case.

A further issue

It is perfectly possible that the parties negotiating a contract have a totally different understanding of the emoji in question. If they do, then this raises a further legal issue.

Was there an agreement?

A principle of English law is that, for a contract to be formed, there must be agreement between the parties. This is often referred to as a ‘meeting of the minds’.

If the parties are interpreting an emoji at cross purposes, then could it still be said that an agreement was reached? And what of other emojis such as a smiley face or a sad face? In a contractual negotiation, what messages do they convey? Can a smiley face constitute an acceptance and a sad face a rejection?

Risks

Clearly, the rapid development of contract law in this area poses the risk of contracts being entered into by accident. The risk is increased if informal methods of communication, such as SMS or WhatsApp, are used.

Within certain commercial sectors, WhatsApp communications are commonly used for contract negotiations, often involving deals worth millions of pounds.

Minimising risk

There are several proactive steps that a business can immediately take:

• Contract negotiations could be conducted in a more ‘formal’ way with the use of emojis being prohibited. Indeed, several companies have done this and have also banned the use of WhatsApp for contractual negotiations.
• Appropriate training could be given to those employees who negotiate contracts, highlighting the risks of inadvertently entering contracts.
• A contracts policy or checklist could be introduced with set authority and sign off levels.
• All contract negotiations could explicitly be undertaken on a ‘subject to contract’ basis. This means that neither party can be bound by their word (or emoji!) unless a formal contract has been reached or signed.
• Terms and conditions of sale and purchase could be amended so that it is clear that a contract cannot be concluded by Emoji.

Summary

There is little doubt that there will be further litigation in this area. Businesses would be wise to consider and minimise their legal risk sooner, rather than later.

And on a separate, concluding note, we are now seeing emojis being referred to in defamation (slander) actions.

Watch this space and be careful what you post!