Increasingly, notice clauses in documents are including provision for service of notices by email. This is in addition to the usual methods of service of notices, by delivery or post, or by fax.
Notwithstanding the popularity of email, how effective is the service of notices by email?
Service by email is included in the following legislation:
Electronic Transaction Act 2000 (NSW) (ETA)
Section 13(3) of the ETA provides that, where an email address is included in the contract, service is effected when the notice enters the information system.
Land and Business (Sale and Conveyancing) Act 1994 (SA)
Recent changes have been introduced to the Land and Business (Sale and Conveyancing) Act 1994 (SA), including service of documents being allowed by email. These changes have come about by way of the Statutes Amendment (Real Estate Reform Review and Other Matters) Act 2013 (SA).
For documents served by fax or email, the time of service is at the time of the transmission of that fax or email.
Intellectual Property Laws Amendment (Raising the Bar) Act 2012 (Cth)
The Intellectual Property Laws Amendment (Raising the Bar) Act 2012 (Cth) introduced significant changes to the regime for filing evidence in patent and trade mark oppositions.
For each new opposition, each party must nominate one preferred email address. That nominated email address is used to invite the parties to the opposition to a “Share”, an online folder that is used in respect of only one proceeding. The Share can be accessed only by the registered users for the proceeding and IP Australia.
The nominated email address is also used for all notifications regarding documents that have been uploaded to the Share. Importantly, users must set their account settings to receive email notifications about documents available from the Share. If not, the user is responsible for checking the Share for updates, potentially increasing the risk of missing important information.
Section 13(3) of the ETA was considered in the decision of the New South Wales Supreme Court in Reed v Eire [2009] NSWSC 678; BC200906296 (Reed v Eire).
The decision provides some guidance on when notices are deemed to have been served by email under section 31 of the Building and Security Industry Security of Payment Act 1999 (NSW) (Act).
The plaintiff, Reed Constructions Pty Ltd (Reed) and the defendant, Eire Contractors Pty Ltd (Eire), entered into a construction contract dated 10 November 2006 (Contract).
The Contract included the GC21 terms and conditions. Under clause 30 of GC21, notices from subcontractors must be sent to the contractor’s authorised person. In this instance Tom Burns was the authorised person and his details were provided for delivery by hand, by registered post, by facsimile or by email.
Eire sent a payment claim by email addressed to Martin Diver from Reed and carbon copied Tom Burns at 3.06pm on 6 November 2008. An email read receipt from Martin Diver was received by Eire at 5.30am on 7 November 2008.
Reed challenged the jurisdiction of the adjudicator to decide the issues of the adjudication based on Eire’s assertion that service had occurred on 6 November 2008. In support of this Reed supplied the adjudicator with the email read receipt that it claimed was proof that the claim had not been served until 7 November 2008.
The adjudicator made a determination that the payment claim was served on 7 November 2008 having relied upon the email proof of receipt.
Reed sought orders from the Court that the adjudicator’s determination should be set aside.
On the service point, if the payment claim was served on 6 November 2008, the payment schedule was received outside the ten day limit prescribed by the Act. In the alternative, if the payment claim was served on 7 November 2008, the payment schedule was delivered within the ten day limit.
The Judge turned to section 13 of the ETA to interpret when actual service of an email is effected.
The challenge that is created by section 13(3) of the ETA is determining and proving when a notice enters the “designated information system”.
While his Honour conceded that electronic communications are more or less instantaneous, there was no technical evidence submitted to the Court other than the time that the payment claim was sent and the read receipt was received. Based on this lack of evidence, his Honour was reluctant to infer that the email was received on the same day that it was sent or, alternatively, on the following day.
Ultimately his Honour held that the adjudicator was entitled to consider the submissions that were made to him and to come to a decision as to when service was effected.
When sending a notice by email the sender can set their computer settings to automatically receive a read receipt.
Currently, to avoid uncertainty regarding service by email, the best practice is to request a read receipt from the individual recipient.
However, any user should discuss their specific needs with their IT department.
The difficulty of establishing that an email has entered a recipient’s information system includes dependence on:
Due to the uncertainties about proving delivery of an email, the other forms of service of notice remain the preferred methods of service.
Some legal service providers do not allow service by email in their documents. Until there is a legislated or court determined method of effective service of notices by email, service of notices by email will remain problematic.
However, given the acceptance of email as a communication tool, this issue is likely to be sorted out in the near future.
