Broker Talk New York: E-mail Has Consequences
Doing Deals in the Digital Age
As reported by C. J. Hughes in the Times a couple of days ago, Naldi v. Grunberg, a case appealed to New York’s highest court, will determine whether a disappointed purchaser was wrongfully denied a right of first refusal to purchase two commercial buildings. The right of first refusal was allegedly offered to the purchaser in an E-mail from a real estate broker involved in the transaction. The lower court allowed the case to continue, but the Appellate Division dismissed the complaint because the purchaser never replied to the E-mail in which the right of first refusal was extended. The Court of Appeals will now decide whether the electronic paper trail was sufficient to create a binding agreement in which the purchaser had a right to continue bidding on a property before the seller accepted a higher offer.
Why It’s Important
Although the case could go either way, as it a question of fact as to whether there was a binding agreement, as the article points out, the Appellate Division affirmed that “e-mails are binding in real estate transactions.” Brokers beware: as a matter of law, E-mail appears to have the same binding effect as the written word. So watch what you send, receive and reply to…