30 January 2020 by and Corporate & Commercial Alert

What’s up with WhatsApp – Is it time to vary our non-variation clauses?

WhatsApp has become an integral part of many people’s lives and their preferred platform for communicating. WhatsApp is simple and convenient to use. It allows you to send messages, make and receive voice and video calls and it also potentially allows one to conclude contractual agreements as seen in the recent court decision in Kgopana v Matlala (1081/2018) [2019] ZASCA 174 (2 December 2019).

The facts in Kgopana v Matlala essentially boiled down to an allegation by the respondent (Matlala) that a contract was entered into between herself and the appellant (Kgopana). Matlala (the mother of one of the appellant’s seven children) sent a message to Kgopana stating that she knew that Kgopana won South Africa’s National Lottery. In response to Matlala’s message, Kgopana sent a WhatsApp message stating that “if I get 20m I can give all my children 1 m and remain with 13m .I will just stay at home and not driving up and down looking for tenders” (sic).

Relying on the WhatsApp message, Matlala issued summons against Kgopana and alleged that the WhatsApp message was an agreement which had been concluded when she accepted the offer contained in the message and therefore, Kgopana was obliged to pay the amount of R1,000,000 for the benefit of their minor child. Kgopana argued that he had no intention to make an offer to contract and had sent the WhatsApp message to get rid of Matlala.

The court a quo found in favour of Matlala and held that the content of the WhatsApp message was clear and unequivocal and contained an offer that was ‘certain and definite in its terms’ and held that an offer had been made ‘with the necessary animus contrahendi’ and that Matlala had ‘readily accepted the offer’. The court a quo held that Kgopana was contractually liable even if he might not have intended to make an offer to contract when he sent the WhatsApp message.

The issue before the Supreme Court of Appeal (SCA) was whether the WhatsApp message sent by Kgopana to Matlala constituted an offer which, upon acceptance, could give rise to an enforceable contract i.e. could Matlala, as a reasonable person, believe that Kgopana intended to enter into an agreement with her? 

The SCA held that the context of the matter strongly suggested that Kgopana did not intend to enter into an agreement with Matlala. The SCA was of the view that the WhatsApp message in fact related to what Kgopana could possibly do in the hypothetical future event of him receiving R20 million. Kgopana subjectively had no intention to contract and the WhatsApp message did not suggest otherwise. The SCA accordingly held that the WhatsApp message clearly did not contain an offer that could on acceptance be converted into an enforceable agreement and in doing so overturned the decision of the court a quo.

In terms of the Electronic Communications and Transactions Act 25 of 2002 (ECTA) electronic documents have the same status as documents which are reduced to writing. There are, however, certain types of agreements which can only be valid if they are reduced to writing and are signed by the parties such as an agreement for the sale of immovable property, wills, antenuptial contracts etc. The legal validity of electronic messages was confirmed by the SCA in the case of Spring Forest Trading 599 CC v Wilberry (Pty) Ltd t/a Ecowash and Another 2015 (2) SA 118 (SCA) (21 November 2014).

The SCA in Spring Forest confirmed the legal validity of the use of an email and an ordinary signature when varying or cancelling a contract which contains a non-variation clause. The SCA also confirmed that the legal requirement for an agreement to be in writing, with the exception of a contract that is required to be reduced to writing, is satisfied if it is in the form of a ‘data message’ as defined in ECTA. The definition of a ‘data message’ as defined in ECTA could be interpreted to include a WhatsApp message. A WhatsApp message is sent, received and stored by electronic means, and therefore by extension of the application of the decision in Spring Forest, WhatsApp may be used to conclude binding contracts. An interesting question is whether an agreement with a non-variation clause can be amended by a WhatsApp message.

Where a contract provides that it cannot be amended unless it is signed in writing by both parties and does not specify the type of signature that is required, by application of the decision in Spring Forest, that contract can be amended by the use of an email and by extension the use of WhatsApp. However, for the amendment to be valid, the sender and recipient of the email or WhatsApp message must sign their names (which can be electronic signatures) at the end of the email or WhatsApp message.

Although WhatsApp has made communication between parties easier and more convenient, WhatsApp messages, as with other electronic communication (i.e. emails or texts from other social media platforms), can often be easily misunderstood and do not necessarily convey the true intention of the sender. The misunderstanding can be caused by various reasons, for example, poor punctuation or the sender being rushed or distracted when sending the message etc. Furthermore, when people communicate over text messages, they do not have the benefit of verbal cues and body language to aid them in interpreting what a person means. The interpretation of text messages can be subjective and open to interpretation which can lead to disputes as were the cases in Kgopana v Matlala and Spring Forest. In light of the above, is it wise to allow a contract to be concluded and amended by using emails and WhatsApp messages?

Non-variation clauses are included in contracts to prevent disputes, but as shown in Spring Forest, standard non-variation clauses are not foolproof and can be circumvented. Thus, to resolve the potential disputes which may arise as a result of electronic communications, it may be desirable to include a definition of writing which excludes a ‘data message’ as a form of writing and a non-variation clause which specifically excludes the use of electronic signatures as defined in ECTA, or alternatively, encourage people to think before they text.

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