A project manager’s cell phone chirps as she is on a busy jobsite. She glances down and sees that it’s the electrical subcontractor on the project asking a question about running wire in a different location to accommodate another trade’s work. She looks at the plans and texts back that the change is fine and to proceed. The electrician moves forward with the work. The following month, the electrician submits a change order for some additional time and materials required by running the wire in a different location, claiming the change was approved by the project manager. Was it?

Not surprisingly, this story and thousands like it happen daily on jobsites. Cell phones are as common as steel-toed boots and hardhats on construction projects (maybe even more so), and six billion text messages are sent every day in the United States alone. It is impossible to escape the potential impact of text messages on construction projects, and particularly, construction contracts.

How Courts are Treating Text Messages

Whether a text message can change a contract, or even form a contract, between parties is still up for substantial debate in courts around the U.S. Typically, it depends on the terms of the contract, state law, the content of the text messages and the conduct of the parties. That’s a lot of “what ifs” that impact a party’s responsibilities under a construction contract. And courts across the country have reached many different conclusions:

• In July 2020, a Texas appellate court determined that where the parties’ text messages contained an agreed price to purchase the contents of an entire home furnishing showroom, this was sufficient to establish an enforceable contract between the parties that the court could (and did) enforce. The text messages proposed purchasing “an entire showroom” for $30,000, to which the seller ultimately responded “that is fine.”
• In a 2017 Florida case, text messages between a hotel employee and guests confirming a specific ballroom for use were accepted by the court to complete the contract between the parties, where the contract only indicated that space would be assigned, committed and reserved in the future. This resulted in significant damages being awarded against the hotel for changing the space offered to the guest the day of an event.
• In 2017, a Louisiana court found that text messages between the parties discussing price and specifics about a yacht sale were not sufficient to establish or support the existence of an agreement between the parties because they did not reference an agreement to those terms. The text messages involved the purchase of a $150,000 yacht.
• In January 2020, a New York court refused to find that a text message from a consultant to a construction company stating “I am finished” was sufficient to terminate a contract between the parties, where the evidence of the text messages submitted failed to include information identifying the parties sending the text messages.

How to Manage the Impact of Text Messages on a Project

The only way to gain control over these unknowns is to ensure that any construction contract contains terms limiting the effect of text messages (or other informal communications) on the terms of the contract and/or limiting the scope of authority to make changes to the contract to certain people. Where such terms exist, courts usually find that even clear text message agreements are unenforceable:

• In 2019, a Mississippi court determined that text messages between a buyer and seller of a home where the seller agreed to install upgraded hardwood on the first floor were not binding where the contract between them indicated it could not be changed without “mutual written consent” and that the parties were not relying on any representations outside of the written terms of the contract.
• In September 2020, a Nebraska court refused to enforce informal communications between a contractor and subcontractor, where the contract between them expressly stated that informal modifications, including by email, text message or verbally, were prohibited and not binding.
• In 2019, a Florida court refused to find that a contract was extended, despite emails and text messages indicating it had been extended, where the contract prohibited modification through course of conduct between the parties without prior written consent.

While many contracts contain anti-waiver, anti-modification and integration clauses, it can be helpful to update these clauses to specifically reference text messages. It can also be helpful to include provisions limiting the people who are authorized to make changes to a contract on behalf of the company. Both of these can help prevent an informal text message from turning into an expensive dispute.

Finally, it is also important to consider how projects typically are managed or run. If project managers frequently use text messages or internal messaging services to communicate with and direct subcontractors, then contract provisions that allow those messages but dictate their impact would be the best solution.

If project managers rarely use these types of services, then complete prohibitions on them or their impact may be appropriate. The bottom line is that contracts should address them in way that is consistent with project goals and project manager typical practices.