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At its core, English contract law demands five essential ingredients to create a binding agreement: an offer, acceptance, consideration (something of value exchanged), certainty of terms and, crucially, an intention by both parties to be legally bound. These elements aren’t mere formalities – they form the bedrock of enforceable deals.

Traditionally, contracts could be forged in many ways – orally, through written letters, or implied by conduct. Unlike many continental legal systems (think France, Germany, Japan, South Korea), where a signed written contract is generally mandatory, English law embraces flexibility. This openness is increasingly tested in the digital era, where communication moves swiftly and informality reigns.

Contract law meets the digital era

Email correspondence long ago became an accepted vehicle for sealing deals. However, what happens when contract negotiations and confirmations occur not in polished emails, but in informal chat apps like WhatsApp? Are emoji laden messages or quick text replies enough to bind parties legally? The High Court judgment in Jaevee Homes Limited v Steve Fincham offers a stark answer – yes they can.

In today’s lightning-fast construction sector, where deals are often struck on smartphones rather than in boardrooms, this case marks a watershed moment. It underscores that courts are prepared to treat informal messaging exchanges as serious, binding contracts when the essential elements are met.

The case facts: Jaevee Homes v Fincham Demolition

The dispute stemmed from demolition work at a nightclub site. Jaevee Homes, a property developer and Fincham Demolition, the contractor, initially negotiated by email. Fincham sent a formal quote via email to Jaevee’s CEO, Ben James, albeit from an email tied to a different business. Things quickly became informal when James and Fincham began hashing out details over WhatsApp.

On 16 May 2023, James requested a reduced price. Fincham replied the next day, proposing £248,000. Later that day, James confirmed Fincham had the contract with a simple WhatsApp: “Yes.” Fincham then indicated the crew would start work “the following Monday” and they agreed payment terms, 28 to 30 days after invoicing, with monthly applications to be submitted.

Despite this, on 26 May, Jaevee sent Fincham a formal contract by email with detailed terms and the agreed price. Work started, invoices were submitted and partially paid, but disputes soon arose over amounts owed and contract terms. Jaevee claimed the formal contract governed, arguing no binding agreement existed from the WhatsApp messages. Fincham insisted the WhatsApp exchange sealed the deal.

What the judge decided

Despite the informal nature of the communications, all the terms needed to form a construction contract were present.

Jaevee questioned who the employer was since Fincham mainly negotiated with James using a different business email. However, the court found the original quote was requested by Jaevee Homes employees and Fincham addressed his quote to “Jaevee Ltd.,” confirming the contract was between Fincham and Jaevee.

While Jaevee argued there was no agreed duration or start date, the court concluded that these elements weren’t essential terms. The start date was effectively set as May 29 in Fincham’s WhatsApp message and the law implies a reasonable timeframe if none is fixed.

Jaevee also claimed payment terms were missing, but the court noted terms can be implied under the Housing Grants, Construction and Regeneration Act 1996. Fincham’s WhatsApp message specified payment “28 or 30 days from invoice” and monthly invoicing was accepted.

The court sided with Fincham, ruling the WhatsApp exchange created a binding contract covering key terms. The later subcontract sent by Jaevee wasn’t part of the deal since Fincham didn’t accept it. Fincham’s invoices were valid under the 1996 Act and Jaevee’s failure to issue payless notices meant they were liable to pay.

Key takeaways

Informal messages pack a legal punch –  don’t ignore the significance of WhatsApp or any quick messaging platform when it comes to contracts. If your texts nail down the essentials, price, scope, timing, you’re basically staring at a legally binding agreement. Courts are increasingly recognising these chats as serious business, so treat your messages like they matter (because they do).

Be cautious using informal channels for negotiations. Sure, WhatsApp makes it easy to fire off messages and hash things out fast, but that speed can backfire. This case shows how casual chats can accidentally lock you into a binding contract before you even realise it. If you’re still in the negotiation phase, whether on WhatsApp or with a loose memo, make it crystal clear that nothing’s final yet, it’s ‘subject to contract’ and a proper, signed agreement is coming. Otherwise, you might find yourself stuck in a deal you didn’t mean to close yet. Play it smart and keep those lines clear!

Final words

The Jaevee Homes v Fincham ruling is a wakeup call for anyone in construction, or any business really, showing how the law is catching up with the way we actually communicate today. WhatsApp and similar platforms aren’t just casual chat tools; they can seal deals that courts will enforce. But here’s the catch: speed doesn’t excuse sloppiness. Digital convenience must be balanced with discipline. Agree on your terms quickly, yes, but back them up with clear, signed contracts and understand your payment rights and obligations inside out. When push comes to shove, the court won’t care if your deal was done in a fancy office or over a smartphone screen. If the essentials are there, the contract is real and the obligations are serious. Don’t let informal communication turn into formal trouble.