Source: https://shapirolegal.com/contract-signed-e-mail-massachusetts-digital-exchange-laws/
Timestamp: 2019-04-24 08:42:02+00:00

Document:
The digital age has ushered in novel methods of conducting business, exploring growth opportunities, and seeking restitution.
All of these opportunities were exploited by Daniel and Lisa Duff, a pair of homeowners in Hingham, Massachusetts who sought enforcement of a putative settlement agreement they executed with their former contractors.
In 2010, plaintiffs Daniel and Lisa Duff hired the defendants to perform a renovation project at their home in Hingham, Massachusetts. Shortly thereafter, a dispute ensued regarding the defendants’ workmanship and their alleged failure to obtain a building permit in a timely manner.
In May of 2012, the Duffs sought redress by initiating arbitration through the State program created in accordance with M.G. L. c. 142A(3).
The following year, on the eve of the assigned arbitrator’s scheduled view of the property, the parties reached an apparent settlement of their dispute.
The email exchange surrounding the announcement of the settlement formed the axis upon which the appellate decision rotated.
Notably, the list of terms did not specify when payment of the $27,500 was due.
Ultimately, the parties agreed on every provision, except for when payment of the $27,500 was due. The Duffs insisted that payment be made when the agreement was executed, while the defendants insisted that they be given some time to complete payment.
With the final issue at a seeming impasse, on April 8, 2013 the Duffs terminated the still-pending arbitration proceeding by withdrawing their request for arbitration. The following day, they filed suit in Superior Court.
Notably, their complaint did not mention the putative settlement agreement or the abandoned arbitration proceedings. Instead, the complaint simply set forth the Duffs’ underlying claims with regard to the defendants’ work on the renovation project (alleging violations of G. L. c. 93A, breaches of contract, negligence, and misrepresentation).
In response, the defendants filed what was styled as a motion to enforce the settlement agreement and to dismiss the complaint.
The trial court judge allowed motion to dismiss and entered judgment requiring the defendants to pay the agreed-to amount within ten days.
The Duffs rested their appeal on two alternative theories that lie in opposition to one another.
Argument one is that because the parties never agreed on a specific date when payment was due, any agreement they had reached was too indefinite to constitute an enforceable contract. Without an enforceable contract in place, they argue, they were free to sue on their underlying claims.
Argument two is that the two sides reached a fully enforceable agreement on March 21, 2013, with payment due immediately upon execution of a formal settlement agreement. The Duffs thusly argue that the defendants breached the agreement by refusing to make timely payment, and this breach justified the Duffs in repudiating the agreement.
What followed was an exhaustive examination of what the necessary ingredients are for an enforceable contract.
In their decision, the Massachusetts Court of Appeals maintained that “An enforceable agreement requires (1) terms sufficiently complete and definite, and (2) a present intent of the parties at the time of formation to be bound by those terms.” Targus Group Intl., Inc. v. Sherman, 76 Mass. App. Ct. 421, 428 (2010).
Saliently, the Court noted that there was no suggestion in the record that the parties ever discussed when payment of the agreed-to settlement amount would be due. To the contrary, each side faulted the other for not raising the issue sooner. The Court cautioned, however, that “the presence of undefined or unspecified terms will not necessarily preclude the formation of a binding contract.” Situation Mgmt. Sys., Inc. v. Malouf, Inc., 430 Mass. 875, 878 (2000).
The discussion then hinged on whether the absence of an agreed-upon specific payment date meant that “significant, material terms were still to be negotiated.” Ibid.
In short, the dispositive issue was whether the absence of a date of remittance would render the contract unenforceable. The court opined that this absence would not destroy the enforceability of the contract.
Addressing the deadline issue directly, the Court stated where a written agreement fails to specify a deadline by which a contractual obligation or right must be exercised, courts may infer that the parties intended a “reasonable” date if this can be done without changing the essence of the contract. See Plymouth Port, Inc. v. Smith, 26 Mass. App. Ct. 572, 575 (1988); Middleborough v. Middleborough Gas & Elec. Dept., 47 Mass. App. Ct. 655, 658 (1999). In turn, “[w]hat is a reasonable period of time depends on the nature of the contract, the probable intention of the parties, and the attendant circumstances.” Plymouth Port, Inc. v. Smith, supra.
Paying careful attention to the digital exchange of communication in this action, the court quoted Accord Fecteau Benefits Group, Inc. v. Knox, 72 Mass. App. Ct. at 212 holding “[E]-mail exchanges between the parties formed a clear and complete agreement . . . [under which t]he material terms were set and agreed upon).
Date of decision: June 14, 2016.

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