Anushree Singh (Advocate) 03 June 2021

Email contract

Hi,

I am a writer and I was recently approached by a Production House A interested in buying option rights to my book. We negotiated and agreed on X consideration amount (even though I knew I was being undervalued and being paid much less than my book's potential) for the deal and they told me they will be sharing the contract draft with me in due course of time. All this negotiation happened via calls and email so far but there was no exchange of monies / token amount. Soon after a contract draft was emailed to me which I was yet to go through and agree upon. Meanwhile, I was approached by another production house (Production House B) who also seemed really keen in my book and said they are willing to pay me whatever amount I quote, so I quoted what I felt would be justified and of course more than Production House A. I told them I am already in talks with the first production house etc and only way I can agree to their offer is if they pay me more than Production House A. All this happened via email/calls. They later emailed me saying they've agreed to my condition and are transferring the signing amount. Soon after they transferred the money. Now I am in a flux. I really wish to go ahead with Production House B but the first Production House is threatening me with legal action saying we have a legal contract (via email) and they will destroy me etc if I did't comply with the contract terms and they own the rights (without making any payment). Here Production House B is also pissed saying they will take me to court for duping them if I went ahead with Production House A.

Can someone please guide in this case? Does Production House A really have a case against me? Thank you.

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3 Replies

Sankaranarayanan (Advocate) 03 June 2021

Mere a e-mail communication has not be treated as agreement of contract. any how, better to take print all the conversation and communication and contact local lawyer who is expertise in the intellectual properties and seeking advise and act accordingly

Rama chary Rachakonda (Secunderabad/Telangana state Highcourt practice watsapp no.9989324294 ) 03 June 2021

As per Section 10 and Section 25 of the Indian Contract Act, 1872, consideration is essential in a valid contract. In simple words, no consideration, no contract established.Action cannot be taken.

Vasundhara Singh (Student) 04 June 2021

Hello, Greetings of the day!

The Indian contract act, 1872 does not specifically mention e-mail contracts but also it does not prohibit any such contracts. E-mail contacts like any other contracts can be governed by the contract act and have fulfilled to conditions provided under the Act to be called a valid contract. First, the terms and conditions of the contract must be agreed to by both parties on the acceptance of an issued offer. Second, the intention to create a legally binding contract must be present. Third, the element of consideration must be agreed upon by both parties.

Section 10A of the Information Technology Act, 2002 also recognizes email contracts as legally binding, valid, and enforceable.

In your case, the talks with production house A were not finalized as the contract was not signed and there was no payment of consideration so it cannot be a valid contract and they cannot bring legal action against you. Production house B has already paid the consideration and both parties are willing to perform their obligations so you can go ahead with the formalities of the contract.

Best Regards,

Vasundhara Singh

Law Student