The recent decision, in Jaevee Homes Limited v Mr Steve Fincham[2025]1, established that informal digital communications can form legally binding agreements when the essential elements of a contract are present.
The court found that an exchange of WhatsApp messages between a property developer and a demolition company formed a legally binding contract.
Essential elements of a contract:
The court considered the presence of offer, acceptance, consideration, and intention to create legal relations in the WhatsApp exchange.
Objective test of intention:
The court applied an objective test, looking at what a reasonable person would infer from the words and conduct of the parties in the messages, rather than their subjective intentions.
Implications:
The case gives weight to digital communications in formation of construction contracts. Businesses must be conscious of the consequences of any digital communication in this regard. Casual or seemingly informal messages can unintentionally bind parties to contractual obligations.
The ruling will no doubt lead to an increase in disputes regarding digital communications in the industry going forward.
[1] Jaevee Homes Limited v Mr Steve Fincham EWHC 942 (TCC)