Westbank Real Estate, Inc. owns 10 acres of forested land. Westbank wants the land cleared in order to build houses. Westbank emails a signed electronic memorandum to a representative of Hardell Lumber Co. offering to sell the mature trees and rich topsoil to Hardell for lumber and agricultural purposes. The electronic memorandum includes the parties' typed names, the consideration, the price, and a description of the property, lumber, and soil. Hardell replies via email to Westbank that it accepts Westbank's terms, electronically signs the memorandum, and will start removing the trees and soil next month. Before Hardell can begin clearing the land, Westbank changes its mind, wants to keep the land forested, and prevents Hardell from accessing the property claiming no contract has been formed.

Does the electronic agreement for the sale of trees and soil fall under the statute of frauds?

The Statute of Frauds holds that there are some contracts including real estate contracts that need to be in written form and then signed to be binding. Some of those contracts include, contracts of sale of goods worth more than $500 as well as contracts that cannot be completed within a year.

We can agree that the trees and top soil are definitely over $500 in value and so this falls under the Statute.

The main bone of contention here however, is probably if the Electronic signature that Hardell used to signed the memorandum entitles the aggrement to legal protection under the Statue of Frauds which requires a signature.

The answer is yes.

The United States Electronic Signatures in Global and National Commerce Act is a federal law. A main provision of this Act is to give electronic signatures the same significance as handwritten signatures. This law is meant to apply to wherever US Federal law applies including states, and US territories. States generally have the right to either accept this law or follow a similar one called the Uniform Electronic Transactions Act (‘UETA’) which was passed in 1999 and bestows upon Electronic contracts, similar status as paper contracts.

The Electronic signature used by Hardell therefore falls under the Statute of Frauds.