Question: My question is whether you can form a legally binding contract by e-mail.

My ex-boyfriend is threatening to sue me for what he claims was a loan for $500. He says he has an email exchange between us where he offered to loan me $500 and I responded back saying, “Ok.” I do not have this email, nor do I remember it. I have asked him to send me a copy, but he hasn’t.

This was never a loan. He wanted to help me and we talked about it. I didn’t want it but he wanted to help me so I agreed. He never described it as a loan until after I broke up with him. Then the emails started coming, demanding $500 repayment for this “loan.” Then we got back together and he stopped asking me about it, even though I had never given him anything. I broke our relationship off again for the final time, and now of course he is asking to be repaid for this supposed loan again. He even had an attorney send me a letter demanding the money or else I was going to get sued. If this e-mail exists, would it be binding?

– Sarah

Answer:¬†There doesn’t need to be any writing for there to be a contract. Contracts can be formed orally. Your ex could submit the e-mail as evidence of what you agreed to if it meets certain requirements for admissible evidence. The question, as far as determining whether a contract exists or not, is going to be whether your ex made an offer, you accepted that offer, and the two of you exchanged “consideration.” “Consideration” means that you each received some benefit and some detriment as a result of your bargain (e.g., he agreed to take on the risk of giving you money, and you agreed to pay interest). If there isn’t consideration, then it’s a gift, not a contractually binding agreement.

If an e-mail really does exist that uses the term “loan,” and your ex can prove that the e-mail saying “Ok” really was sent by you, a small claims court judge might find that compelling. But if the e-mail from him says, “I’m giving you $500 whether you think you need it or not,” then that sounds more like a gift. It’s difficult to predict what would happen without knowing the exact contents of the e-mail (and litigation is unpredictable even when you have seen all the evidence).

Your ex can file a small claims case without showing you the e-mail. But if he’s as confident that it says what he claims it says, I would think he would want to show it to you and avoid the hassle of filing a case, serving you, going to court, etc. Depending on how worried you are about this, you could offer to settle with him even before he files a lawsuit. For example, you could offer to pay him $100 to waive any right that he has to repayment, with the possibility that you’ll pay more if he can produce an e-mail that shows the two of you really were talking about this money as a loan (note that a settlement is also a contract, and you would want to get any agreement in writing, with a very clear explanation, acknowledged by both of you, that, in exchange for the money you’re paying to him, he is agreeing to waive his right to sue or otherwise recover compensation for any money he gave or loaned to you).

Or call his bluff and make him sue you. Even if the worst-case scenario comes to pass — he files a lawsuit and wins — the result would be that you would have to pay him $500, exactly what he’s asking for anyway (I’m assuming his e-mail didn’t contain a fee shifting provision specifying that the loser of any lawsuit would have to pay the other side’s attorneys’ fees). There would be some hassle and inconvenience if you get sued, but if it were me, I’d be reluctant to unconditionally capitulate based on his claims about what this supposedly smoking gun e-mail that he’s refusing to produce says.

Hope that helps.

— Dan