When is an agreement not an agreement?

The case of Fordell Estates Limited v Deloitte LLP [2014] CSOH 55 considered whether the contents of email communications between chartered surveyors, as agents, could create a legally enforceable agreement between the parties.

Despite email exchanges between the parties which discussed the terms on which an offer from Deloitte was accepted but Deloitte’s condition that Fordell Estates provide tender documentation was not met, it was held that both parties did not have a manifest intention to legally bind themselves to all elements of the bargain as there was clear evidence that there had been no meeting of the minds on key aspects of the deal.

Thus, when forming an agreement, three crucial questions should be answered:

  • Does the person you are dealing with have the necessary authority?
  • Is there an intention for the parties to be bound?
  • Have all key aspects been agreed?

For the avoidance of all doubt – always reduce your final terms into a signed formal legal agreement.

Rob

Deaf, hubby to Rachel, dad to Corey, Libby and Emily, Solicitor, Lecturer in Legal Practice at University of South Wales, PhD student at University of Leicester.

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