8 ms·

Contract by Email

70 points by feross 5y ago

benatkin 5y ago
It's so pretty, but it's still terrible. Check the Survival section. "No reverse engineering" for 5 years after the 1 year contract terminates (everything under the Confidential Information section). Not signing that. Will have to consider uninstalling email apps from my phone, so I don't accidentally agree to one of these when I'm behind on sleep. (https://www.sleepfoundation.org/sleep-deprivation/lack-of-sleep-and-cognitive-impairment https://www.sleepfoundation.org/sleep-deprivation/lack-of-sl...)
briandoll 5y ago
Or just never sign NDAs since they are almost universally egregious and don't benefit you at all to become party to. 99% of the time when you say no, the other party will just shrug and say ok.
- Y_Y 5y ago
  I have NDAs preventing clients from passing on the awful secrets I reveal to them, I don't know if that's egregious but I definitely appreciate it.
- rubidium 5y ago
  "99% of the time when you say no, the other party will just shrug and say ok." You must live in a particular bubble of NDA's. For product R&D in Biotech (non-California at least), NDA's are nearly universal and never optional. You don't sign, you don't work.
  - paxys 5y ago
    Yeah, their scenario is a fantasy unless the party signing the NDA has more leverage, which is never the case.
- hn_throwaway_99 5y ago
  I sign, and require signatures, for non-egregious NDAs all the time. You will quickly find that at outright refusal to sign an NDA will very quickly limit your business options, especially when negotiating between corporate entities.
- bob1029 5y ago
  NDAs are extremely important for businesses to be able to work together on common projects. I work in finance and if I told one of my customers or vendors that we were not going to execute an NDA, the conference call would end very abruptly. Also consider if the tables were turned and it was you who had the mountains of IP and other liabilities that would be shielded by an NDA.
- lowercased 5y ago
  totally depends on situation. I've been asked to sign NDAs. "Hey, i got this cool idea, sign my NDA". The couple times I've done that have been... not worth the effort, and never amount to anything. But they're still some mental overhead I have to keep account of for a while. "We're bringing you in to project X, and we've agreed to payment terms, and project length. Sign this NDA preventing you from sharing our corporate secrets (with some reasonable definition of 'secret') to work on the project". I've generally no problem with those sorts - they are a part of real project/work/life, and generally money is attached. I've given up dealing with the first sort, and have "lost out on some big opportunities" (their words, not mine) because of the refusal. I've managed to eke out a living nonetheless.
dctoedt 5y ago
One of the main points here is that in the U.S., contracts can be agreed to by email (or text). (Kyle, thanks for the shout-out in TFA.)
- jbverschoor 5y ago
  Well the same in Europe, but there's also a distinction between the levels of how to authenticate parties.
- swiley 5y ago
  Why wouldn't that be legal? Obviously you should be using S/MIME or GPG if you're worried about fraud but it's not like hand signatures are all that secure.
  - warkdarrior 5y ago
    Actually you should be using S/MIME or GPG if the other party is worried about fraud. If fraud happens (someone claiming to be you signs a contract), it is typically the other party to the contract that loses, because they did insufficient due diligence to ensure that they are entering into an agreement with the correct partner.
  - CheezeIt 5y ago
    Hypothetically, it could be that some law was worded “in writing or verbally, or via telegram” and it didn’t include other forms of communication. There is in fact a U.S. law that defines “writing” in some parts of the law to encompass electronic communication in some manner as well. So some federal laws that required certain kinds of agreement to be in “writing”, like, IIRC, exclusive copyright licensing, now permit electronic communication.
  - danielrhodes 5y ago
    I wouldn't think about wet ink signatures as a matter of security, per se. A contract is only valid as long as both parties stick to it. If there's a disagreement, it's up to a court to figure it out. That's where you get into risk mitigation. If you are comfortable with a court making a determination based on an exchange over email, then great. Courts see email as a valid form of proving one's identity. If you want to go further to reduce the risk that a court invalidates the contract, you can do things like having witnesses, wet ink, notaries, etc. Obviously for a contract with low material value, it's not a big deal. Signing a multi-million dollar contract? People start taking whatever measures they can to ensure things are air tight. A lot of tech people think risk mitigation is only verifying somebody's identity, but a court could decide a contract is invalid because the person signing it had no idea what was inside. So there's a lot more to it.
EGreg 5y ago
This won't actually work. Because the document at that link can change. What can work is if there is a hash of the data, and you hope that the data is still there at the link. Better if you have the actual data that was signed. Which means, we're back to actual documents. What we SHOULD have, however, is a github for lawyers.
- dctoedt 5y ago
  > Because the document at that link can change. The document at the link is a PDF, so the "the document is changeable" problem could be addressed by downloading the PDF and attaching it to the email agreement to serve as the record copy. TFA also points out that the document is at the Internet Archive: https://web.archive.org/web/*/https://waypointnda.com/3.0.0 https://web.archive.org/web/*/https://waypointnda.com/3.0.0
  - robbedpeter 5y ago
    Why are pdfs any more secure than a txt file, other than the editing being more obnoxious in the case of pdfs?
    - dctoedt 5y ago
      Hard-copy documents can be fraudulently altered after signature too. The question is, how much more burden do you want to impose on the parties to address the infinitesimal fraction of cases where that kind of fraud might be involved. EDIT: Each party presumably will have email records with the PDF attachment — and if the attachments don't agree, then the parties' lawyers will be busy. But again, how likely is that to happen, and how much time and money do you want to spend to prevent it? At some point you hit diminishing returns (and OCD behavior).
      - sdoering 5y ago
        This reminded me of a great talk (in German) by David Kriesel about scanners not scanning correctly but replacing letters and numbers because of pattern matching (if I remember correctly). It was a really great talk. Not sure if there is an English version somewhere: https://www.youtube.com/watch?v=7FeqF1-Z1g0 https://www.youtube.com/watch?v=7FeqF1-Z1g0
jrm4 5y ago
I'm just happy to see something about contracts here that's actually about contracts -- not about the blockchain things called "smart contracts," which are neither smart (okay, that's debatable) but definitely not contracts.
- foobarbecue 5y ago
  Yeah and don't you hate how graphs aren't graphs and trees aren't trees? These people talk about bootstrapping when they aren't even referring to footwear! And always talking about bandwidth as if it's a maximum data rate when the term really refers to the electromagnetic spectrum! Makes me so angry how these people treat language as if it's some fluid thing where homonyms develop.
  - shuntress 5y ago
    "graph", "tree", "boostrapping", and "bandwidth" are all fairly accurate analogies. "smart contract" is a buzzword (incidentally, you may notice that it is not literally buzzing). The parent comment is like saying "I'm just happy to see something about crypto that's actually about cryptography"
    - foobarbecue 5y ago
      Wow, downvoters, excuse me for having a little fun! But since you want to be serious, let's bikeshed this: What word would you rather we use, in place of "smart contract," to refer to the small programs that run on the blockchain?
      - scrollaway 5y ago
        Serverless lambda cloudchain functions!
        foobarbecue 5y ago
        SLCFs it is.
denton-scratch 5y ago
You can make a contract on the phone; hell, two people in the middle of a meadow can make a verbal contract that's completely valid (provided there's an "exchange of considerations", and the contract is "fair" - depending on jurisdiction). The problem with verbal contracts is that it's hard to produce evidence about such contracts, if it comes to enforcement. Email would be OK, if the agreement were assigned to the custody of some mutually-trusted party. It's no good if the parties to the agreement each save their copy of the text/plain agreement on their own corporate mailserver.
- kragen 5y ago
  Most of the time when there's a court case over these things, the disputed facts do not include which email was sent at what time and what it said. If the other party does choose to dispute those facts, it's true that you would have a hard time proving that you were in the right without some sort of witness like what you're describing; but usually they don't. (It's neither necessary nor sufficient that both parties trust the witness at the time; what matters is whether the court believes the witness if a dispute arises.)
- dctoedt 5y ago
  The Statute of Frauds requires some societally-significant contracts to be in writing, and makes oral contracts in those categories unenforceable. The law-student mnemonic is MY LEGS — a written contract is required for agreements concerning: Marriage (e.g., prenups); Year (contracts that cannot be performed within one year); Land; Executor (when the executor of a dead person's estate agrees to pay the decedent's debts out of the executor's own pocket); Guarantor (of another's debt); Sales (of goods for $500 or more). [0] Nit: Strictly speaking a written contract is a "verbal" contract, because in this context, verbal means, in essence, using words, as opposed to, say, gestures or drawings. ("Verbal" derives from the Latin verbum. [1]) [0] https://www.investopedia.com/terms/s/statute-of-frauds.asp https://www.investopedia.com/terms/s/statute-of-frauds.asp [1] https://en.wiktionary.org/wiki/verbum#Latin https://en.wiktionary.org/wiki/verbum#Latin
  - only_as_i_fall 5y ago
nanomonkey 5y ago
What are the necessary components of a contract? If I wanted to create a document storage for contract datastructures, each having their own unique content addressable hash, what are the key features that would be needed to be considered a legal contract? Name/Title, creator, recipients, signatures/acknowledgements and terms? Are their specific terms involved. Any specs on this sort of electronic data?
- greggyb 5y ago
  In the US, generally speaking, the following items are necessary for a contract: 1. Multiple parties 2. Consideration: all parties must get something out of it. You may have an agreement where you don't get something out of it, but you cannot have a contract where you get nothing out of it. 3. Offer, acceptance, and mutual assent. One must make the offer, the other(s) must accept, and all have to see eye-to-eye. 4. Legality: you can't make a contract to perform illegal acts. A contract with an assassin is not legally a contract -- one cannot be found in breach of this contract by a court of law no matter what (though bringing the suit may incriminate you for conspiracy to commit murder). 5. Parties legally able to enter contracts. Minors can't enter contracts.

70 points by feross 5y ago

It's so pretty, but it's still terrible. Check the Survival section. "No reverse engineering" for 5 years after the 1 year contract terminates (everything under the Confidential Information section). Not signing that. Will have to consider uninstalling email apps from my phone, so I don't accidentally agree to one of these when I'm behind on sleep. (https://www.sleepfoundation.org/sleep-deprivation/lack-of-sleep-and-cognitive-impairment https://www.sleepfoundation.org/sleep-deprivation/lack-of-sl...)

briandoll 5y ago

Or just never sign NDAs since they are almost universally egregious and don't benefit you at all to become party to. 99% of the time when you say no, the other party will just shrug and say ok.

Y_Y 5y ago
I have NDAs preventing clients from passing on the awful secrets I reveal to them, I don't know if that's egregious but I definitely appreciate it.
rubidium 5y ago
"99% of the time when you say no, the other party will just shrug and say ok." You must live in a particular bubble of NDA's. For product R&D in Biotech (non-California at least), NDA's are nearly universal and never optional. You don't sign, you don't work.
- paxys 5y ago
  Yeah, their scenario is a fantasy unless the party signing the NDA has more leverage, which is never the case.
hn_throwaway_99 5y ago
I sign, and require signatures, for non-egregious NDAs all the time. You will quickly find that at outright refusal to sign an NDA will very quickly limit your business options, especially when negotiating between corporate entities.
bob1029 5y ago
NDAs are extremely important for businesses to be able to work together on common projects. I work in finance and if I told one of my customers or vendors that we were not going to execute an NDA, the conference call would end very abruptly. Also consider if the tables were turned and it was you who had the mountains of IP and other liabilities that would be shielded by an NDA.
lowercased 5y ago
totally depends on situation. I've been asked to sign NDAs. "Hey, i got this cool idea, sign my NDA". The couple times I've done that have been... not worth the effort, and never amount to anything. But they're still some mental overhead I have to keep account of for a while. "We're bringing you in to project X, and we've agreed to payment terms, and project length. Sign this NDA preventing you from sharing our corporate secrets (with some reasonable definition of 'secret') to work on the project". I've generally no problem with those sorts - they are a part of real project/work/life, and generally money is attached. I've given up dealing with the first sort, and have "lost out on some big opportunities" (their words, not mine) because of the refusal. I've managed to eke out a living nonetheless.

dctoedt 5y ago

One of the main points here is that in the U.S., contracts can be agreed to by email (or text). (Kyle, thanks for the shout-out in TFA.)

jbverschoor 5y ago
Well the same in Europe, but there's also a distinction between the levels of how to authenticate parties.
swiley 5y ago
Why wouldn't that be legal? Obviously you should be using S/MIME or GPG if you're worried about fraud but it's not like hand signatures are all that secure.
- warkdarrior 5y ago
  Actually you should be using S/MIME or GPG if the other party is worried about fraud. If fraud happens (someone claiming to be you signs a contract), it is typically the other party to the contract that loses, because they did insufficient due diligence to ensure that they are entering into an agreement with the correct partner.
- CheezeIt 5y ago
  Hypothetically, it could be that some law was worded “in writing or verbally, or via telegram” and it didn’t include other forms of communication. There is in fact a U.S. law that defines “writing” in some parts of the law to encompass electronic communication in some manner as well. So some federal laws that required certain kinds of agreement to be in “writing”, like, IIRC, exclusive copyright licensing, now permit electronic communication.
- danielrhodes 5y ago
  I wouldn't think about wet ink signatures as a matter of security, per se. A contract is only valid as long as both parties stick to it. If there's a disagreement, it's up to a court to figure it out. That's where you get into risk mitigation. If you are comfortable with a court making a determination based on an exchange over email, then great. Courts see email as a valid form of proving one's identity. If you want to go further to reduce the risk that a court invalidates the contract, you can do things like having witnesses, wet ink, notaries, etc. Obviously for a contract with low material value, it's not a big deal. Signing a multi-million dollar contract? People start taking whatever measures they can to ensure things are air tight. A lot of tech people think risk mitigation is only verifying somebody's identity, but a court could decide a contract is invalid because the person signing it had no idea what was inside. So there's a lot more to it.

EGreg 5y ago

This won't actually work. Because the document at that link can change. What can work is if there is a hash of the data, and you hope that the data is still there at the link. Better if you have the actual data that was signed. Which means, we're back to actual documents. What we SHOULD have, however, is a github for lawyers.

dctoedt 5y ago
> Because the document at that link can change. The document at the link is a PDF, so the "the document is changeable" problem could be addressed by downloading the PDF and attaching it to the email agreement to serve as the record copy. TFA also points out that the document is at the Internet Archive: https://web.archive.org/web/*/https://waypointnda.com/3.0.0 https://web.archive.org/web/*/https://waypointnda.com/3.0.0
- robbedpeter 5y ago
  Why are pdfs any more secure than a txt file, other than the editing being more obnoxious in the case of pdfs?
  - dctoedt 5y ago
    Hard-copy documents can be fraudulently altered after signature too. The question is, how much more burden do you want to impose on the parties to address the infinitesimal fraction of cases where that kind of fraud might be involved. EDIT: Each party presumably will have email records with the PDF attachment — and if the attachments don't agree, then the parties' lawyers will be busy. But again, how likely is that to happen, and how much time and money do you want to spend to prevent it? At some point you hit diminishing returns (and OCD behavior).
    - sdoering 5y ago
      This reminded me of a great talk (in German) by David Kriesel about scanners not scanning correctly but replacing letters and numbers because of pattern matching (if I remember correctly). It was a really great talk. Not sure if there is an English version somewhere: https://www.youtube.com/watch?v=7FeqF1-Z1g0 https://www.youtube.com/watch?v=7FeqF1-Z1g0

jrm4 5y ago

I'm just happy to see something about contracts here that's actually about contracts -- not about the blockchain things called "smart contracts," which are neither smart (okay, that's debatable) but definitely not contracts.

foobarbecue 5y ago
Yeah and don't you hate how graphs aren't graphs and trees aren't trees? These people talk about bootstrapping when they aren't even referring to footwear! And always talking about bandwidth as if it's a maximum data rate when the term really refers to the electromagnetic spectrum! Makes me so angry how these people treat language as if it's some fluid thing where homonyms develop.
- shuntress 5y ago
  "graph", "tree", "boostrapping", and "bandwidth" are all fairly accurate analogies. "smart contract" is a buzzword (incidentally, you may notice that it is not literally buzzing). The parent comment is like saying "I'm just happy to see something about crypto that's actually about cryptography"
  - foobarbecue 5y ago
    Wow, downvoters, excuse me for having a little fun! But since you want to be serious, let's bikeshed this: What word would you rather we use, in place of "smart contract," to refer to the small programs that run on the blockchain?
    - scrollaway 5y ago
      Serverless lambda cloudchain functions!
      - foobarbecue 5y ago
        SLCFs it is.

denton-scratch 5y ago

You can make a contract on the phone; hell, two people in the middle of a meadow can make a verbal contract that's completely valid (provided there's an "exchange of considerations", and the contract is "fair" - depending on jurisdiction). The problem with verbal contracts is that it's hard to produce evidence about such contracts, if it comes to enforcement. Email would be OK, if the agreement were assigned to the custody of some mutually-trusted party. It's no good if the parties to the agreement each save their copy of the text/plain agreement on their own corporate mailserver.

kragen 5y ago
Most of the time when there's a court case over these things, the disputed facts do not include which email was sent at what time and what it said. If the other party does choose to dispute those facts, it's true that you would have a hard time proving that you were in the right without some sort of witness like what you're describing; but usually they don't. (It's neither necessary nor sufficient that both parties trust the witness at the time; what matters is whether the court believes the witness if a dispute arises.)
dctoedt 5y ago
The Statute of Frauds requires some societally-significant contracts to be in writing, and makes oral contracts in those categories unenforceable. The law-student mnemonic is MY LEGS — a written contract is required for agreements concerning: Marriage (e.g., prenups); Year (contracts that cannot be performed within one year); Land; Executor (when the executor of a dead person's estate agrees to pay the decedent's debts out of the executor's own pocket); Guarantor (of another's debt); Sales (of goods for $500 or more). [0] Nit: Strictly speaking a written contract is a "verbal" contract, because in this context, verbal means, in essence, using words, as opposed to, say, gestures or drawings. ("Verbal" derives from the Latin verbum. [1]) [0] https://www.investopedia.com/terms/s/statute-of-frauds.asp https://www.investopedia.com/terms/s/statute-of-frauds.asp [1] https://en.wiktionary.org/wiki/verbum#Latin https://en.wiktionary.org/wiki/verbum#Latin
- only_as_i_fall 5y ago

nanomonkey 5y ago

What are the necessary components of a contract? If I wanted to create a document storage for contract datastructures, each having their own unique content addressable hash, what are the key features that would be needed to be considered a legal contract? Name/Title, creator, recipients, signatures/acknowledgements and terms? Are their specific terms involved. Any specs on this sort of electronic data?

greggyb 5y ago
In the US, generally speaking, the following items are necessary for a contract: 1. Multiple parties 2. Consideration: all parties must get something out of it. You may have an agreement where you don't get something out of it, but you cannot have a contract where you get nothing out of it. 3. Offer, acceptance, and mutual assent. One must make the offer, the other(s) must accept, and all have to see eye-to-eye. 4. Legality: you can't make a contract to perform illegal acts. A contract with an assassin is not legally a contract -- one cannot be found in breach of this contract by a court of law no matter what (though bringing the suit may incriminate you for conspiracy to commit murder). 5. Parties legally able to enter contracts. Minors can't enter contracts.