New York Appellate Court: Email Signature Created Binding and Enforceable Settlement | Practical Law

New York Appellate Court: Email Signature Created Binding and Enforceable Settlement | Practical Law

In Forcelli v. Gelco Corp., the New York Supreme Court, Appellate Division, held that an e-mail message satisfied the subscription requirement of the state's settlement agreement statute, creating a binding and enforceable stipulation of settlement.

New York Appellate Court: Email Signature Created Binding and Enforceable Settlement

Practical Law Legal Update 0-537-7686 (Approx. 3 pages)

New York Appellate Court: Email Signature Created Binding and Enforceable Settlement

by Practical Law Commercial
Published on 14 Aug 2013 • New York
In Forcelli v. Gelco Corp., the New York Supreme Court, Appellate Division, held that an e-mail message satisfied the subscription requirement of the state's settlement agreement statute, creating a binding and enforceable stipulation of settlement.
An opinion from the New York Supreme Court, Appellate Division, in Forcelli v. Gelco Corp. held that an e-mail message containing the sender's typed name satisfied the criteria of New York's settlement agreement statute, creating a binding and enforceable stipulation of settlement.
In a suit resulting from a car accident, the insurance adjuster for one driver's employer, Gelco, sent a confirmation e-mail message to the plaintiffs' attorney. The e-mail confirmed settlement negotiations that had taken place between the parties and requested that the plaintiffs sign a release. After the plaintiffs signed the release, but before the insurance adjuster received it in the mail, the court granted Gelco's motion for summary judgment, dismissing the complaint. Since Gelco won the lawsuit, Gelco's attorney attempted to reject the release, claiming that no settlement was consummated under CPLR § 2104. The plaintiffs moved to vacate the summary judgment order and enforce the settlement.
CPLR § 2104 states that when a settlement is not made in open court, an agreement between parties is not binding unless it is in a writing subscribed by the party or its attorney. The appellate court held that the e-mail constituted a writing and subscription by Gelco's insurance representative, despite the fact that e-mail cannot be signed in the traditional sense and that the e-mail at issue contained a printed signature as opposed to an electronic signature as defined by the Electronic Signatures and Records Act. Finding the stipulation of settlement binding and enforceable, the court noted that:
  • The author of the e-mail purposefully added her name to the end of the message, rather than using an automatically generated signature.
  • The face-to-face mediation at which the settlement was attempted, and the subsequent follow-up phone calls, indicated that the author intended to subscribe the e-mail settlement for purposes of CPLR § 2104.
The appellate court held that an e-mail may be deemed a subscribed writing under CPLR § 2104 if:
  • It contains all the material terms of a settlement and a manifestation of mutual accord.
  • The party to be charged, or its agent, types its name manifesting an intent that the name be treated as a signature.
Signature requirements, particularly electronic signature requirements, vary from state to state. Negotiating parties should be aware of the signature requirements of the applicable jurisdiction to ensure that any resulting contract is enforceable, and to avoid the consequences of unknowingly creating a binding contract.
For more information on signature requirements, see Practice Note, Signature Requirements for an Enforceable Contract. For information on drafting electronic signature clauses, see Standard Clause, General Contract Clauses: Electronic Signatures.
Court documents: