Fort Worth Business Press, June 2, 2014 Vol. 26, No. 22 - Page 15

fwbusinesspress.com | June 9 - 15, 2014 15 Electronic contracts in the digital age The multi-million dollar email H ow easy is it to enter into a binding written legal agreement nowadays? About as easy as clicking “send” on an email. The ease of entering into an electronic contract has made our lives more convenient and more dangerous. Let me explain. General rule – no written agreement necessary The general rule for contacting in Texas has always been that no formal written agreement is necessary to create most kinds of binding legal agreements. A contract can arise by oral agreement, with or without a handshake. Generally, for a contract to be enforceable, it requires only that the contracts meet very basic requirement, such as (1) an offer and an acceptance of the offer, (2) a “meeting of the minds” of the parties regarding the key terms of the agreement, (3) an exchange of consideration, and (4) absence of fraud, duress, mistake, forgery, unconscionability or other barriers to contract. Exceptions to general rule – Statute of Frauds and Uniform Commercial Code Texas law recognizes some exceptions to the general rule, however. Some types of agreements must be in writing and signed by the party against whom enforcement is sought to be enforceable. Perhaps this is because lawmakers felt that certain agreements were too important or too easily prone to fraud or mistake to rely upon oral agreements. For example, the Texas Statute of Frauds identifies categories of agreements that must be in writing and signed to be enforceable, such as (1) a promise by one person to answer for the debt of another person; (2) an agreement made on consideration of marriage; (3) a contract for the sale of real estate, including oil and gas interests; and (4) an agreement which is not to be performed within one year, including a real estate lease. Another example is in the Uniform Commercial Code (UCC), which requires contracts for the sale of goods of $500 or more to be in writing to be enforced. Uniform Electronic Transactions Act If you read the Statute of Frauds or the UCC, you might think that all of the agreements described in the previous paragraph must be written on a piece of paper and signed with a ballpoint pen. But in 2001, Texas adopted the Uniform Electronic Transactions Act (UETA). Under UETA, parties are permitted to satisfy the requirement that an agreement be in writing and signed