Introduction

Generally speaking, a contract for the sale of land comes into existence when: (a) parties agree on the 3 "Ps" (i.e. property, price, and parties); (b) the agreement is supported by consideration; and (c) parties intend that the agreement be legally binding.

However, a crucial aspect of contracts for the sale of land is that such contracts must also comply with section 6(d) of the Civil Law Act in order to be enforceable. Section 6(d), which has its origins in the 1677 Statute of Frauds, essentially provides that a contract for the sale or disposition of immovable property is not enforceable unless "the agreement upon which such action is brought, or some memorandum or note thereof, is in writing and signed by the party to be charged therewith, or some other person lawfully authorised by him".

That being the case, is an agreement for the sale of land made over email enforceable under section 6(d)?

The Singapore Court of Appeal had occasion to examine this issue in the case of Joseph Mathew and another v Singh Chiranjeev and another [2010] 1 SLR 338 ("Joseph Mathew"), which closely followed SM Integrated Transware Pte Ltd v Schenker Singapore (Pte) Ltd [2005] 2 SLR 651 ("SM Integrated"). In SM Integrated, the High Court held that certain emails exchanged between a prospective landlord and tenant constituted the necessary memorandum required under section 6(d) to be enforceable, notwithstanding that parties had not actually put their handwritten signatures to a formal agreement.

"You’ve got mail!" - emails as sufficient memorandum

In Joseph Mathew, the appellants (the owners) conducted negotiations with the respondents (the intending buyers) through a property agent. The negotiations were conducted orally as well as over email. The respondents offered to buy the property, and handed the property agent a cheque for 1% of the purchase price, in consideration for the option to purchase. The property agent emailed the first appellant the key terms of the option and requested his confirmation. The first appellant replied that he was "taking a decision to proceed to sell the property" and also requested that the cheque be deposited into his bank account. However, later the first appellant informed the property agent and the first respondent that he was cancelling his plan to sell the property. The option was never signed.

The key issues before the Court of Appeal were: (a) whether there was a binding contract between the parties for the grant of an option for the sale of the property; (b) if there was a binding contract, whether the requirements in section 6(d) were satisfied; and (c) if the requirements in section 6(d) were not satisfied, whether the contract between the parties was nonetheless enforceable on the ground of part performance.

The court found there was a valid contract (as there was offer, acceptance and sufficient consideration) and that all the requirements under section 6(d) were satisfied. The court also held in dicta that even if section 6(d) had not been satisfied, the doctrine of part performance would nevertheless apply, by virtue of the respondents' act of payment of the 1% deposit.

Central to the court's reasoning was that a valid contract had come into existence when the 1% was cashed, and that the signing of the option was a "mere formality" to "[give] effect to a binding agreement that had already been entered into [by the parties]".

The ambit of construing emails as sufficient memorandum under section 6(d) was thus extended to contracts for the sale of land as well in the decision of Joseph Mathew.

So do we have a deal?

The cases of Joseph Mathew and SM Integrated demonstrate that the courts are willing to construe emails as sufficient memorandum pursuant to section 6(d). The decisions are sensible, given the wide use of email as a mode of communication in the property industry.

A learning point to note from these two decisions, however, is that if parties do not wish to be inadvertently bound by email correspondence, their emails should be clearly marked 'subject to contract' and that any contract that is to be made should be by way of a formal, signed agreement.