Wednesday, February 23, 2011

Contract created by e-mail exhange

River Wind Ventures Ltd. v. British Columbia, 2011 BCCA 79 is a useful case where an exchange of emails between the parties already in a contractual relationship was held to be a valid and enforceable contract, collateral to the existing agreement. The contract created by e-mail met the requirements for an enforceable collateral agreement under the principles stated in Hawrish v. Bank of Montreal, [1969] S.C.R. 515. The importance of the case is not so much the creation of new law as presenting an example of a contract created by e-mail.

The Court held:

[14] The Credit Offer is characterized as a collateral agreement for issues of enforcement. Hawrish v. Bank of Montreal, [1969] S.C.R. 515 at 524, adopts the principle of enforceability as follows:

A distinct collateral agreement, whether oral or in writing, and whether prior to or contemporaneous with the main agreement, is valid and enforceable even though the main agreement be in writing, provided the two may consistently stand together so that the provisions of the main agreement remain in full force and effect notwithstanding the collateral agreement.

Hawrish outlines three elements required for enforceability of a collateral contract. They are that:

a) the terms of the contract are clearly shown;

b) there is a clear intention to contract; and

c) the collateral contract is not inconsistent with or does not contradict the main contact.

1 comment:

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