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Can you utilize e-mail (or electronic mail) to exercise an option when an agreement provides for the delivery of "written notice" of the election?
A recent Appellate Division case, Brainstorms Internet Mktg., Inc. v. USA Networks, Inc., suggests that, if there isn't a prohibition or restriction in the underlying agreement, e-mail may be an appropriate notification method, provided that the message's content "strictly complies" with the option's terms. (Since the e-mail in this particular case was silent as to the option's exercise, the communication failed to serve as an effective triggering mechanism.)
Notwithstanding the growing acceptance of electronic mail as a mode of communication, there are still a number problems with that form--and the underyling technology--that makes us wary. For example, how does one establish receipt of the e-mail, if the recipient refused the option to issue an electronic receipt and/or later denies receiving the communication? (Is one's recourse to subpoena an "Internet Service Provider?") What if the message was unreadable or inadvertently blocked by a spam filter and thus not "delivered" to the intended recipient? Additionally, what if a court were to find that the election to exercise the option electronically failed to "strictly" comply with the terms of the parties' agreement?
Since the risk of an adverse end-result remains significant, old-fashioned "in-hand delivery" or other form of receipted mail or courier service--as dictated by the terms of the governing agreement--may still be the best option.
For a copy of the Appellate Division's decision in Brainstorms Internet Mktg., Inc. v. USA Networks, Inc., please click on the following link: