What is an Electronic Contract?
An electronic contract is piece of information, communications, or correspondences in an electronic document, creating obligations between two or more correspondents that are enforceable or otherwise recognisable at law.
Formation of Electronic Contract.
Traditionally, a contract may be made or entered orally or in writing or implied from the conduct of the parties. The advent of the electronic documents as additional means of entering into a contract other than a paper document, has not change the basic requirements for the formation of a contract of a valid and enforceable contract.
It has however, added to the variant of a written agreement, thereby giving the parties intending to enter into a written agreement or contract the option of having it on the traditional paper document or in a dematerialised format of an electronic document. Whichever means a contract is entered or formed, the law recognises five vital ingredients as the constituent of a valid and enforceable contract.
These are
1. Offer
2. Acceptance
3. Consideration
4. Capacity to contract and
5. Intention to create legal relationship.
See: College of Medicine v. Adegbite (1973) 3 SC. 149; Nimanteks Associates v. Marco Const. Co. Ltd. (1991) 2 NWLR (Pt. 174) 411 at 427, per Tobi JCA (as he then was).
Thus, before there can be said to be the formation of an electronic contract between the correspondents, it must be apparent or implicative that, there was an offer and an acceptance backed by consideration with the intention to create a legal relationship between the correspondents who possessed/possess the capacity to enter into such a contract.
The value of reliability placed on electronic correspondence in Nigeria is very low, as many users of electronic platform including some lawyers are either not aware that, electronic contracts can be implied or made from mere electronic correspondences without signatures or are wary of entering into a contract without a direct face to face communication. The latter may be due to the online fraudulent activities of internet fraudsters known as “yahoo boys” or due to ignorance of the fact that, transacting business on electronic platforms is cost effective and time saving compare to than traditional paper platforms.
The absence of a statutory legal framework on electronic transactions in Nigeria is enough to invoke doubts on the validity of the contract. Fortunately, however, the provisions of the Nigerian recent Evidence Act, 2011 on electronic evidence provides the necessary legal protection for the enforcement of electronic contract in Nigeria. Moreover, it is not the doubting or the believing of the validity of a contract that makes it valid or invalid in law, but the presence of the basic ingredients of a valid contract in the contract in issue, be it a paper or an electronic contract.
Formation of an electronic contract is not rocket science or an esoteric or complex transaction, as some perceive it, it only demand for more legal creativity on the part of the solicitor engaged to see to an enforceable electronic contract.
Our free legal advice to anyone or organisation about to accept an electronic offer or sign a contract-agreement on paper, is to seek for a good Lawyer to review the electronic offer or contract, before electronically accepting the offer or before appending your signature.
You may contact IDOWU ODUBANJO & ASSOCIATES for further illuminations on your paper or electronic contracts.
CONTACT :
IDOWU ODUBANJO & ASSOCIATES.
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Surulere, Lagos, Nigeria.
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