Sask. appeal court gives 2 thumbs up to decision that emoji is contractually binding

Saskatchewan’s Court of Appeal has upheld a prior decision that a thumbs-up emoji was confirmation of a contract between two agricultural companies.

Achter Land & Cattle Ltd appealed a 2023 decision from the Court of King’s Bench that its owner had agreed to sell flax to a grain buyer from South West Terminal (SWT) when he responded to a text containing photos of the $58,000 contract with a thumbs-up emoji.

Achter Land & Cattle grows and sells grain. The company has sold grain to SWT since about 2012, according to court documents.

In March 2021, an SWT employee sent a photo of the front of a double-sided contract to Chris Achter with a message that read, “Please confirm flax contract.”

The employee, Kent Mickleborough, said he spoke with Achter and Achter’s father, who helps with farm operations, and reached a verbal agreement to buy the flax at $17 per bushel, with delivery deferred until the fall.

A Court of King’s Bench decision in June found that the thumbs-up emoji was confirmation of the contract, despite Achter’s argument that he never signed the contract.

‘Just a different way of communicating’

Josh Morrison, counsel for South West Terminal, said modern law is media-neutral. He said the text message exchange was the contract — which included the photo of the contract and its details, the message asking for confirmation and the thumbs up emoji.

“It’s no real different than the words that he texted in previous contracts — OK, looks good, yup — the thumbs-up emoji is just a different way of communicating,” he said.

The court ruled that the metadata from a personal cellphone was enough to consider the emoji a personal signature.

Achter Land & Cattle “did not harvest a single bushel of flax” that year, according to Achter’s evidence.

When time came to deliver the flax, sometime between September and November, the price had increased by $24 a bushel.

The Court of King’s Bench ruled that Achter must pay SWT the difference, about $82,200 in damages, plus interest, because of the breach of contract, among other costs.

Morrison said the Achter Land & Cattle’s next course of action could be to take the case to the Supreme Court of Canada, but the court weould have to decide the case hold’s national importance for it to be heard.

Morrison said it’s unclear if the case sets precedent, because the two parties had a history of previous contracts to base this ruling on.

A proper signature

Two Court of Appeal judges upheld the original decision, finding the two companies had communicated about the essential terms of the contract, intended to enter into the contract and that the emoji constituted an electronic signature. 

Syngrafii Inc., an intervenor in the case, argued the text message cannot be considered an electronic signature because it was never physically signed onto the document.

The court disagreed because the emoji was “a part of a chain” that included a photograph of the contract and was, therefore, associated with the contract.

John Gruetzner, the COO of Syngrafii Inc., said he’s happy that the court noted in its decision that governments may need to consider amending laws around signatures, given how compliance has changed.

“I think that you have to have a joint review of this, both at the provincial and federal level, and obviously that’s easier said than done,” he said.

A disagreement among judges

Not all the appeal judges fully sided with the previous ruling.

One judge agreed that there was a contract between the two companies outlined in the text messages, but disagreed that Achter’s text constituted a signature.

Justice Brian Barrington-Foote wrote there needs to be something more substantial than a form of a “yes” in response to the contract, even if it comes from an identifiable phone number.

Barrington-Foote said characterizing the metadata as a signature “would unnecessarily and improperly stretch the signature requirement beyond recognition.”

He stated that the trial judge erred in his interpretation of The Sale of Goods act and the appeal should have been allowed.