The buyer texted, “Glad we could reach an agreement.” The builder’s brother replied, “Me too ….”
These eight words forced a $2.8 million luxury home saleback in Perl v. Grant. In 2024, the Montana Supreme Court held that several informal texts about disputed construction costs satisfied the statute of frauds and constituted an enforceable contract, displacing the buyers fighting to keep the property.
The Perl dissenting justices, however, emphasized that the builder’s brother was merely a “consultant” who lacked binding authority.
After the 2024 National Association of Realtors commission settlement removed compensation offers from the MLS, the Perl result cut deeper. Buyer-agent compensation now moves through email and text, along with concessions and other material terms. Do such electronic communications form enforceable contracts?
Why previous protections are disappearing
Under California’s statute of frauds, texts are insufficient for real estate contract formation absent written confirmation. But courts in other states have held that emails and texts can form enforceable contracts under the statute of frauds and contract doctrine. Three recurring factual gaps previously prevented contract formation, as Massachusetts and Florida cases illustrate.
In St. John’s Holdings v. Two Electronics, the 2016 Massachusetts Land Court held that a broker’s first name, typed at the end of a text message, satisfied the signature requirement under the state statute of frauds. The seller later won on appeal in 2017 because the broker lacked binding authority.
In Walsh v. Abate, a 2022 Florida appellate court held that unsigned electronic messages between agents for a house seller and prospective buyer “accepting” a list price offer failed under the statute of frauds. The seller’s agent texted that the seller would “accept the $3.4 million,” and the buyer’s agent texted back, “Perfect and confirmed. Thank you!” The seller’s agent even emailed that the seller “thanks him for his patience and accepts $3.4 million.”
Days later, the seller accepted a different offer. Because no written agreement had been signed by both parties, the court affirmed on appeal that these electronic messages were negotiations that bound no one. However, they did trigger costly litigation.
Since the NAR settlement, these contract-preventing factual gaps are disappearing:
- Material terms missing: Previously, electronic messages often lacked price, closing date or property description, but agents now negotiate material terms over email or text.
- No signature: Many electronic messages previously had no typed name. However, the UETA (Uniform Electronic Transactions Act) treats typed names as electronic signatures, and agents now routinely sign emails and texts electronically.
- No authority to bind principals: Standard listing agreements authorize brokers to market the property, not to contract on sellers’ behalf, but agents frequently communicate directly with unrepresented principals such as FSBO sellers or unrepresented buyers.
5 safeguards for every text and email
Each of these safeguards is a small change in digital habits. Each one targets a contract element that state courts commonly examine (as illustrated above) when ruling whether an email or text forms an enforceable real estate deal. Run all five past your managing broker this week before using them.
- Use a non-binding disclaimer in substantive messages. The North Carolina Real Estate Commission (in its 2021 eBulletin, “A Broker’s E-mail Might Prove BINDING!“) advised brokers to state, “This email or text does not create acceptance or a binding contract.”
- Flag at least one material term as still open. When electronic communication concerns price or concessions, leave something explicitly unresolved: “Closing date, inspection contingency, and financing terms still to be worked out.” If even one material term is genuinely undecided, the contract generally remains unenforceable.
- Disclaim authority to bind, after confirming the disclaimer is accurate. Confirm from the actual listing or buyer-broker agreement that this statement is true, before adding: “I do not have authority to bind my client by email or text. All agreements require my client’s written signature.” Standard and non-standard forms may address this differently from power of attorney documents.
- Include an integration clause in the written contract. The 2025-2026 GAR Purchase and Sale Agreement Section c.4(f) states the contract “shall not be deemed to have been mutually departed from or waived except upon the written agreement of the parties.” Ask your managing broker whether comparable language exists or is needed by special stipulation for your state.
- Recognize when the agent-to-agent “buffer” thins or disappears. Georgia Realtors’ General Counsel Seth Weissman has called agent-to-agent texts “nothing more than noise.” That buffer thins in states without comparable contract language and disappears when the other side of the message is an unrepresented principal, like a FSBO seller or unrepresented buyer. Safeguards one through four especially matter then.
Consider walking clients through your safeguards in listing and buyer presentations; a written-communication protocol is a professionalism signal that helps you stand out.
Under the NAR settlement, brokers and agents cannot avoid electronic messages about material terms, and three factual gaps that prevented contract formation in past litigated cases — omitted price or closing date, unsigned message and broker without binding authority — are disappearing.
Before a routine text arguably forms a contract you never intended, or triggers litigation over whether it did, make sure your safeguards are valid in your state before you send the next one.
Kelly Lise Murray, J.D., is a Harvard-trained attorney and former Vanderbilt Law faculty member. She cofounded VettingTheHouse.com and DivorceThisHouse.com. Get connected on YouTube and LinkedIn.
