Legal Admissibility of collaboration solutions

As the web continues to transform the way that business is conducted both in the consumer and business to business markets contractual law also evolves. Consumers enter into contracts every time they make online purchases and they are bound by Terms and Conditions when they use cloud based solutions to store, share and retrieve their personal data and photos.

Building contracts from the JCT, NEC and FIDIC are also being updated incrementally to reflect changes in how information is transferred from sender to recipient. The same general legal principles apply whether parties communicate electronically or on paper. Where the contract previously insisted on giving of notices ‘in writing’ now references to electronic communication have been introduced. With specific regard to legal admissibility in existing standard contracts, it is useful to look at existing contractual clauses...

JCT 2005: Clauses 1.7 and 1.8

  • “Where the contract does not specifically state the manner of giving such notices, such notices shall be given or served by any effective means to any agreed address."

Revision 2 2009 amalgamates the notices clause and the electronic communications clause with an entirely new clause 1.7 unifying the notices and communications requirements into one contract term. Throughout the contract, references to individual clauses’ written notices or communications requirements have been deleted. For example, in the Standard Building Contract:

In clause 3.10.1, “in writing” is deleted. and in clause 7.1, consent to an assignment does not now expressly refer to written consent.

New versions of the JCT suite are due in late 2011 so it will be interesting to see any further changes.

NEC Contract

New Engineering Contract: 13.1 and 13.2

  • 13.1 “each instruction, certificate, submission, proposal, record, acceptance, notification and reply which this contract requires is communicated in a form which can be read, copied and recorded." and
  • 13.2 “A communication has effect when it is received at the last address notified by the recipient for receiving communications or, if none is notified, at the address of the recipient stated in the Contract Data."

FIDIC: 1.3

  • “...in writing and delivered by hand (against receipt), sent by mail or courier, or transmitted using any of the agreed systems of electronic transmission as stated in the Appendix to Tender...."

The FIDIC contract also includes a specific section for stating the “Electronic transmission systems for communications shall be as follows:”

The following are samples clauses from online retail contracts:

  • 1.1 Writing includes e-mail, facsimile transmission and or communication in another durable medium that is available and accessible.
  • 2.1 Any communication sent electronically by e-mail or otherwise.
  • 2.1.1 Will be deemed to have been sent once it enters an information system outside the control of the originator of the message;
  • 2.1.2 Will be deemed to have been received by intended recipient at the time that in a readable form it enters an information system that is capable of access by the intended recipient.

A good collaborative extranet provides both a means of communication and an audit trail. The 4Projects audit trail is second to none. 4Projects will show when a document was created, when it was uploaded, who uploaded it, who read it, when they read it and so on. In short, using a 4Projects extranet is likely to have more weight in court than a traditional, error prone paper-based system, an e-mail system or FTP site.