The statute of frauds, electronic signatures, and time is of the essence

Three separate questions

A real estate agreement raises three distinct questions: Is there an adequate signed writing? Does an electronic format satisfy the applicable requirements? Was performance timely? Passing one test does not answer the others.

The statute of frauds

The statute of frauds generally requires specified agreements to be evidenced by a writing signed by the party against whom enforcement is sought, or an authorized representative. It concerns enforceability, not whether someone behaved fraudulently. An oral agreement within the statute is generally unenforceable, rather than automatically void. The writing must adequately identify the agreement and its essential terms; a sufficient memorandum may serve this purpose.

For example, Texas Business and Commerce Code section 26.01 covers contracts for the sale of real estate, leases longer than one year, and agreements not to be performed within one year from their making. A quick closing does not remove a land sale from the sale category. The party to be charged means the person against whom enforcement is sought, not the person paying closing costs. Exceptions can be fact dependent; disputed enforceability calls for legal advice.

Electronic signatures

Under 15 United States Code section 7001, a covered transaction cannot be denied legal effect solely because its record or signature is electronic. This does not supply missing assent, essential terms, or signing authority. Nor does it require a private party to accept electronic records. Electronic signing involves intent to authenticate; typing a name as background information is different from adopting it as a signature.

Records must be retainable and accurately reproducible when the law requires a writing. Required written consumer disclosures have additional consent and access requirements. Electronic delivery does not change their required content or timing.

Time is of the essence

A time-is-of-the-essence provision makes timely performance material and calls for strict compliance with the deadlines it covers. Identify the particular duty, trigger date, cutoff time, permitted extension, and consequence. Do not assume that one paragraph controls all deadlines.

For a Texas example, paragraph 5 of TREC's resale contract makes time of the essence for that paragraph. It extends specified payment-delivery deadlines when their last day is a Saturday, Sunday, or legal holiday. That provision does not extend the option termination notice deadline, which is 5 p.m. local time where the property is located on the specified date. A valid electronic signature does not excuse a late notice.

Check the writing, check electronic execution and retention, then check performance against the actual contract.