The High Court decision in Jaevee Homes Ltd v Fincham [2025] EWHC 942 (TCC) is an important reminder that contracts do not always begin with a formal document. They can begin with something as simple as an exchange of messages on a phone. In this case the court held that a short WhatsApp conversation between Jaevee Homes Ltd, a property developer, and Mr Steve Fincham, trading as Fincham Demolition, created a legally binding contract because the essential terms had been agreed. The parties later attempted to formalise the arrangement, but the contract had already been formed.
For small business owners this highlights the growing risks of relying on informal communication to agree work. It shows why a clear written and signed agreement must be in place before anything begins, and why businesses should not negotiate key terms through messaging platforms.
The Background and Why the Case Went to Court
Jaevee Homes Ltd asked Fincham Demolition for a quotation for demolition works. After the quotation was sent, the parties continued their discussions on WhatsApp. Fincham asked whether the job was his so he could begin organising the work, and Jaevee replied with a simple “yes”. They also discussed payment terms such as “28 or 30 days from invoice”.
Fincham Demolition later carried out the work and issued a series of invoices. Some invoices were paid, but others were disputed by Jaevee Homes. This led to an adjudication where the adjudicator found that a WhatsApp contract had been formed. The adjudicator awarded Fincham £145,896.31 plus interest because no valid “pay less” notices had been served.
Why the Payment Dispute Escalated
Part of the dispute centred on the payment process. In the construction industry the law requires the paying party to follow strict rules when challenging an invoice. If they want to pay less than the amount claimed they must serve a valid “pay less notice” explaining the amount they intend to pay and the reasons for paying less. This notice must be served within a specific legal deadline. Jaevee Homes did not serve valid pay less notices in response to the invoices from Fincham Demolition. As a result the adjudicator was required to treat the invoices as payable in full and awarded £145,896.31 plus interest to Fincham. This is one of the reasons the case escalated and why the court had to decide which contract applied.
Jaevee Homes then took the matter to the High Court, arguing that the binding contract was not formed through WhatsApp but through the later written subcontract it had emailed to Fincham. This written subcontract had more detailed terms and a different invoicing procedure. Jaevee argued that because the written document had been sent, those terms applied.
The High Court rejected that argument. It held that the contract had already been created through the WhatsApp exchange and that the later written document had never been accepted.
How the WhatsApp Messages Became a Contract
The court held that the WhatsApp messages contained the essential elements of a binding agreement between Jaevee Homes Ltd and Fincham Demolition. These were:
- the scope of work
- the price
- the payment terms
- an intention to proceed
Once these elements were present, the contract was formed. The court noted that the parties behaved as though the contract existed. Fincham began work and Jaevee accepted and paid some of the invoices. Their actions supported the conclusion that a WhatsApp contract had been formed.
Why the Written Contract Did Not Save the Parties
A key detail is that the written subcontract Jaevee emailed after the WhatsApp exchange was never signed. Fincham did not sign it, did not return it and did not indicate acceptance. Because of this, the High Court held that the written contract never came into effect. The legally binding agreement had already been formed through the WhatsApp messages where the essential terms were agreed.
This meant the detailed protections in the written contract, such as limitation of liability, cancellation terms and detailed invoicing procedures, did not apply. It shows clearly how relying on informal messages can remove the benefit of the written terms a business intended to rely on.
Why This Increases the Importance of a Proper Written Contract
A small business should not rely on casual messages to confirm the terms of a job. A WhatsApp conversation is rarely complete, rarely clear and rarely protective. A written contract includes essential clauses that manage risk, clarify expectations and protect a business if a dispute arises.
There are several risks when work begins based on informal messages rather than a signed agreement.
Loss of control over your own terms
If the court decides that the a contract was formed before your written agreement was issued or signed, your own contract terms may not apply. This removes important protections you may have relied on.
Unclear scope and increased disputes
WhatsApp or other messages rarely contain enough detail. If expectations are not written down in detail, disputes become more likely, especially around what was included, what was excluded and how changes should be handled.
Unintended legal obligations
Short informal messages can appear to confirm terms even where the intention was to follow up later. A simple “yes”, “that works” or “start Monday” can be enough to create a binding contract.
How an Entire Agreement Clause Helps Protect You
A well drafted written contract should include an entire agreement clause which states that the signed contract is the full agreement between the parties and that earlier discussions are not binding. This reduces the risk that prior WhatsApp messages or emails become part of the legal agreement.
However this protection only applies once the contract is signed. If work begins before signing, the court may decide that the contract was formed earlier and the entire agreement clause may not apply. This is why timely signing is essential.
Avoid Using WhatsApp or Similar Platforms to Discuss Terms
Messaging platforms are useful for updates but they should not be used for discussing key terms such as price, deliverables, approval to proceed or payment arrangements. These discussions can be misinterpreted and can create an unintentional contract even when a formal agreement is intended.
If a client attempts to confirm work on WhatsApp it is best to explain politely that all contractual terms must be agreed through the written contract.
Always Get the Contract Signed Before Work Begins
We cannot emphasise how important this is. We have had countless clients come to us who have, for various reasons, overlooked this and later, had to navigate a dispute. The safest approach is to issue your written contract at the earliest opportunity. Make clear to the client that:
- nothing is agreed until the contract is signed
- no work will begin until both parties have signed
This protects both sides and ensures expectations are clear from the outset.
Checklist for Small Businesses
1. Avoid agreeing work or discussing key terms on WhatsApp or similar platforms.
2. Issue your written contract early and insist on signing before work begins.
3. Make it clear that nothing is binding until signed.
4. Include an entire agreement clause and a no oral modification clause.
5. Train your team to be careful with informal communications.
6. Do not start work, prepare materials or allocate time until both parties have signed the agreement.
Conclusion
The Jaevee Homes Ltd v Fincham case shows how easily a binding agreement can be formed through informal messages. For small businesses the lesson is clear. Relying on WhatsApp conversations or similar can remove the protection of your written contract and expose you to unnecessary risks. By issuing your contract early, securing signatures promptly and avoiding informal agreement of terms, you can protect your business and ensure every project begins on a clear and secure basis.
We can assist you with bespoke contracts to safeguard your business or a review of an existing contract you may be using to check it sufficiently protects you. We also have a massive range of contract templates in our online store to support you and get that contract in place early on!