In today’s commercial world, the point at which an informal exchange becomes a binding contract is increasingly easy to miss. What once required a carefully negotiated and signed document can now arise from a rapid sequence of emails, a WhatsApp exchange between meetings, or a brief exchange on a video call. For businesses, that creates opportunity, but also risk.
The Court of Appeal ruling, DAZN Ltd v Coupang Corp [2025] EWCA Civ 1083, is a reminder of how easily that line can be crossed. The negotiations in that case were conducted largely through informal communications. One party maintained that nothing was binding until a formal document had been executed. The Court disagreed, confirming that a binding contract may be formed even when negotiations take place mainly through WhatsApp or email.
The Court stepped back and assessed the overall picture: Were the essential terms agreed? Did the communications show mutual commitment? Would a reasonable businessperson think a deal had been done? The decisive factors were that the essential terms, including price, were agreed and no “subject to contract” wording was used.
English law makes no distinction between WhatsApp messages, emails and formally drafted letters. Everyday phrases like “agreed”, “confirmed”, “we accept” or “let’s proceed”, often sent quickly to maintain commercial momentum, can carry the same legal weight as a signature, when viewed in context.
The underlying legal principles governing contract formation remain the same: offer and acceptance, intention to create legal relations, consideration and certainty of terms remain central. What differs today is the commercial context in which those principles are applied.
Similarly in Jaevee Homes Ltd v Fincham (High Court, 2 May 2025), the Court confirmed that WhatsApp and email exchanges can create a legally binding agreement even without a formally executed document, provided the essential elements of contract formation are present and the parties behave as though a contract exists. The judgment also emphasised that where parties contemplate greater formality, such as structured pricing, payment mechanisms or detailed technical terms, the court will scrutinise the substance of communications and post-negotiation conduct to determine whether a binding agreement arose before formal documentation.
Limits of informality
However, important limits remain. Where legislation or the nature of the transaction requires specific formalities, such as written execution or signature, informal exchanges are not sufficient. As reaffirmed in Golden Ocean Group Ltd v Salgaocar Mining Industries Pvt Ltd [2012] EWCA Civ 265, no enforceable contract arises until mandatory form requirements are satisfied. Technology may accelerate negotiation, but it cannot override legal form.
Practical implications for businesses
Informality should not be mistaken for a lack of legal effect. The speed of modern commerce increases risk of unintended agreements. Messaging apps do not merely facilitate discussion; they create a clear evidential record of negotiations.
The use, or absence, of “subject to contract” can be significant. Just as importantly, what parties do after reaching apparent agreement may confirm that a binding contract exists.
In practice, contract formation now happens daily within sales, procurement and operational teams and legal advice is evolving from reactive problemsolving to proactive risk management.
Businesses should therefore train staff on the risks of casual communication, move negotiations to email or contract management platforms once terms become substantive, manage conduct carefully during negotiations. If a binding commitment is not intended, that must be stated clearly and consistently. And conduct must align with that position: do not commence performance, ship goods or issue purchase orders unless the intention to contract is clear. Conduct is one of the fastest ways to form a contract unintentionally. Use “subject to contract” consistently where non-binding status is intended and implement clear internal authority rules, by defining who may bind the company.
Conclusion:
Certainty and intention still matter and the words we choose, often typed quickly on a phone, matter more than ever.
What has accelerated is the pace of commercial exchange. Agreements can emerge rapidly, sometimes before the parties realise they have crossed the line from negotiation to commitment.
In a fast-moving commercial world, the organisations that protect themselves most effectively are not those that delay progress, but those that combine commercial agility with a clear understanding of the legal consequences that may follow from everyday communications.
