If you're busy you may find you often negotiate contracts quickly by e-mail. But what happens if despite e-mail negotiation, you never actually sign a written contract? Could you still be bound? Generally a contract is only valid when it is signed by both parties. However, if both parties agree the terms of a contract, perhaps by e-mail, and both then act in a way that indicates an intention to accept the terms of this agreement, they might may find themselves bound to a contract. Our tips:

1. Make sure that every senior manager, director or a person with the ability to bind the firm is aware that binding contracts can be created by exchange of e-mails.
2. Clarify exactly who has the authority in your company to enter into contracts.
3. If you don't want to risk creating a binding contract, make sure that any e-mail or other correspondence, and even conversations, are expressed to be "subject to contract".
4. If you negotiate it by e-mail – keep the negotiation in one e-mail chain – this should save you having to hunt for e-mails at a later stage and should reduce the risk of accidentally agreeing to contractual terms by e-mail.

For more information on legally binding contracts, or if you are involved in a contract dispute, contact Nigel Mills, our commercial litigation solicitor, via email or by calling 01722 422300.