By Sarah Morrison, Staff Writer
The mailbox rule is learned by first year law students in Contracts class. Acceptances are valid upon time of dispatch; offers, revocations, and rejections are valid upon time of receipt. However, in an increasingly digital world the UETA § 15 has modified this rule for electronic communications.[1]
The Uniform Electronic Transactions Act (UETA) was published in 1999 and adopted by forty-seven states plus the District of Columbia, Puerto Rico, and the Virgin Islands.[2] New York, Illinois, and Washington have adopted similar laws.[3]
The issue raised regarding electronic communications and contracts goes beyond just clicking “send”. Subsection (a)(1) requires that the electronic record “is addressed properly or otherwise directed properly to an information processing system that the recipient has designated or uses for the purpose of receiving electronic records or information of the type sent and from which the recipient is able to retrieve the electronic record.”[4] This can be thought of in terms of a physical mailbox. Was the letter addressed properly? Was the letter delivered to the correct mailbox? Can the recipient access that mailbox? If all questions can be answered “yes”, then the first element of sending a communication electronically is satisfied.
Furthermore, subsection (a)(2) requires that the electronic communication is in a form that can be processed by the receiving system.[5] This became an issue in my most recent role working in contract negotiation. Because much of the information that was being transmitted was confidential, the senders and I would encrypt our e-mails prior to sending. Problems arose when communicating with external companies whose processing systems would reject the encrypted e-mails. The e-mails either would not transmit completely to the receiver’s inbox or would arrive in a format that recipients would be unable to open. We found a work-around by placing all confidential information into an attachment and encrypting the attachment.[6]
The final part of the sending requirements under UETA is subsection (a)(3), which is that the system that receives the communication is under the control of the recipient. There are two instances where this raises an issue.[7] Most commonly is with “do-not-reply” e-mail addresses. A do-not-reply e-mail will bounce the response back to the sender without ever reaching the intended recipient. These addresses do not have an inbox, so there is no way a person could monitor the e-mails sent to the address. The second instance is a shared inbox. A shared inbox is an e-mail address to which several people have access. The issue here is that although the party to whom the communication is intended has access to that inbox, there is the possibility that the communication can be intercepted by another or deleted. Therefore, it is typically not recommended to send contractual information to a shared inbox.[8]
In sum, when sending an offer, acceptance, revocation, or rejection electronically, the communication must be addressed properly, enter a system that can receive that type of electronic format, and must be accessible by the receiver.
Sources:
[1]15 U.S.C. §7002
[2]Id.
[3]Id.
[4]15 U.S.C.A. §7002(a)(2)
[5]Id.
[6]Id.
[7]15 U.S.C. §7002(a)(3)
[8]Id.
