From Paper to Platforms: The Impact of Informal Digital Communications in Construction Contracts

By Rahma Majid

In Ontario, sections 11(1) and 19(3) of the Electronic Commerce Act grants electronic documents, including contracts and e-signatures, a similar legal status as their traditional paper document counterparts.[1]

However, what happens when a contractor sends a text message proposing a seemingly minor adjustment to a construction project plan and the project manager replies with a thumbs up emoji, “👍”.

When instructions are communicated through multiple channels by individuals with varying levels of authority, interactions like this can raise questions about whether a binding contractual variation has occurred.

Traditionally, disputes involving construction contract variations have relied on documents like site notes, formal written correspondences, and signed change orders as evidence. Despite the continued use of formal written processes, emails, cloud-based project management data, digital schedules and mobile communications now generate vast quantities of informal project administration records that may become the very source of dispute. This creates a tension between the contractual formality, and the everyday reality of how a project unfolds on site.

What Does the Court Say on this Issue?

While many construction contracts troubleshoot this problem through clauses that require any variations to be signed and made in writing, courts have increasingly adopted a contextual approach to contractual variation, focusing less on rigid written formalities and more on whether the parties objectively intended to modify their agreement through their conduct. This is reflected in the case of Rosas v. Toca (“Rosas”). In this case, the British Columbia Court of Appeal confirmed that contractual variation is enforceable when mutual agreement is reflected through the parties’ conduct. This decision reflects the proposition that intention and conduct of the contracting parties prevail over formal requirements. More recently, the court has applied this principle to digital communications.[2]

In Achter Land & Cattle Ltd. v Southwest Terminal Ltd (“Achter”), at issue was the formation of a contract where an employee sent a proposed agreement through a text message, to which a representative of the other party replied with a thumbs up emoji.[3] The court held that, when viewed in the context of the parties’ prior dealings and established method of communication, a valid and enforceable contract existed between the two parties as evident through their pattern of past interactions.

What does this Case Law mean in practice?

Construction participants in Ontario should not assume that Achter would necessarily produce the same outcome here. Unlike British Columbia, Ontario generally continues to require fresh consideration before most contractual variation will be considered enforceable.

This was the case in Gilbert Steel Ltd. v. University Construction Ltd., where the court held that an oral agreement to abandon an existing written contract did not constitute fresh consideration and was therefore insufficient to enforce obligations under the new oral agreement.[4] While the requirement for fresh consideration in Ontario acts as a restraint on informal contract variations, cases such as Rosas highlights a different direction in which current case law across other Canadian provinces has evolved.[5]

Practical Takeaways for Construction Professionals

When communications about who can bind a project or approve extra work on site comes through multiple levels of authority, it may create disputes that involve fragmented exchanges, making it difficult to construct a coherent narrative from a series of correspondences. As a result, the outcome of a contract dispute may ultimately depend on the interpretation of key digital communications within the broader contextual and factual matrix of a particular case.

On construction projects, project instructions, approvals and requests for additional work are often communicated through text messages, and digital project management platforms by individuals with differing levels of contractual authority. When disputes arise, determining whether a particular communication constituted a binding instruction, or whether the individual who sent it had authority to bind the parties, may play an important role that is considered within the broader contextual and factual matrix of a particular case.

This increasing reliance on digital communication platforms raises broader issues around risk allocation in construction contracts. Construction contracts follow a complex structure as projects often involve owners, project managers, on-site superintendents and subcontractors that communicate through different platforms and hold different levels of contractual authority. Construction professionals should then ensure that contracts clearly identify who has authority to issue instructions and approve variations, and whether electronic communications like text messages can constitute binding approvals. As Achter demonstrates, seemingly informal digital exchanges may later become central evidence in determining legal obligations. Preserving complete records across text messages, emails and project management platforms then becomes equally important as disputes unfold from paper to platforms.

[1]Electronic Commerce Act, 2000, S.O. 2000, c. 17.

[2]Rosas v. Toca,2018 BCCA 191.

[3]Achter Land & Cattle Ltd. v Southwest Terminal Ltd., 2024 SKCA 115.

[4] Gilbert Steel Ltd. v. University Construction Ltd., 1976 CanLII 672 (ONCA).

[5] See also NAV Canada v. Greater Fredericton Airport Authority Inc., 2008 NBCA 28.