Commercial Litigation Series (2): Without a Formally Signed Contract, Can WhatsApp Chat Records Alone Prove a Contractual Relationship?
Written by Law Yew Jun (Woon Wee Yuen & Partners)
It is not uncommon, in the commercial disputes we handle, for the parties to have entered into a transaction without signing a formal written contract.
For example, in a sale of goods transaction, the seller has delivered the goods as agreed, and the buyer has received and even used them and made part payment. However, when the seller asks for payment of the outstanding balance, the buyer begins giving various reasons for delaying payment.
The reverse situation may also arise: after receiving the goods, the buyer considers that they do not conform to the parties’ agreement and asks the seller to accept their return, provide a refund, carry out repairs or supply replacements, but the seller has not taken any action.
After repeated communications fail to resolve the matter, one party eventually decides to resolve the dispute through litigation. Only then does a problem come to light:
The parties have not signed a formal contract.
Clients often ask:
“We do not have a contract, but we have WhatsApp chat records. Can we sue?”
In some cases, the other party may even state outright:
“We did not sign a contract, so I have no obligation to pay.”
Is that argument valid?
The answer does not simply depend on whether the parties have signed a formal contract. What must actually be determined is whether the parties have reached a legally binding agreement and whether the available evidence can establish exactly what they agreed.
1. Must a Contract Be Formally Signed to Be Valid?
In many cases, no.
Under section 10 of Malaysia’s Contracts Act 1950, an agreement may constitute a legally binding contract if it satisfies the applicable legal requirements for contract formation. Unless the law requires the transaction to take a particular form, an ordinary commercial contract does not necessarily require the parties to sign a formal written contract in order to be legally effective.
In practice, commercial transactions are also often not concluded in a single step through one document.
For example, the parties may first discuss the price and quantity through WhatsApp, then confirm certain commercial terms by email. The buyer then places an order, the seller arranges production or delivery and subsequently issues an invoice, and the buyer makes part payment after receiving the goods.
In such circumstances, even if the parties have never signed a formal document entitled “Contract” or “Agreement”, that fact alone does not establish that no contractual relationship exists between them.
What the court generally needs to determine is:
Whether the parties have agreed on the principal terms of the transaction, and
whether their subsequent conduct shows that an agreement has been formed and that performance has commenced.
Accordingly, in commercial litigation, the key question is usually not “Is there a signed contract?”, but:
“Can the available evidence establish what the parties agreed and what they subsequently did?”
2. How Does the Court Determine Whether a Contract Has Been Formed?
The court will generally not consider any single document in isolation, but will assess the parties’ legal relationship in the context of the entire course of the transaction.
For example, a quotation may establish the price and commercial terms proposed by the seller; WhatsApp messages or emails may show that the parties negotiated the price, quantity, delivery date or method of payment; a purchase order may establish that the buyer formally placed an order; a delivery order or acknowledgement of receipt may show that the seller fulfilled its delivery obligation; an invoice may establish that the seller requested payment of the relevant amount; and part payment reflected in bank records may provide further evidence that the buyer accepted the transaction and began performing its payment obligation.
Viewed in isolation, any one of these items of evidence may be insufficient to establish the contractual relationship in full.
However, if these documents corroborate one another, for example:
Quotation → Price confirmation → Order → Delivery → Acknowledgement of receipt → Invoice → Part payment
The chain of evidence may reveal the entire process, from negotiations and agreement on the transaction to actual performance.
Therefore, the absence of a formal contract does not mean there is no evidence.
What often affects the outcome of a case is whether the business can connect the documents and communications produced at different stages to establish that the parties agreed on a transaction and what its specific terms were.
3. Can WhatsApp Chat Records Prove a Contractual Relationship?
Yes, but that answer must be understood with care.
WhatsApp, WeChat and email have become very common means of communication in modern commercial transactions. Businesses may use these tools to discuss prices, confirm quantities, change delivery dates, accept orders and even confirm payment arrangements.
Malaysia’s Electronic Commerce Act 2006 recognises that electronic messages are not to be denied legal effect merely because they are in electronic form. Electronic communications can therefore provide important evidence of the terms agreed between the parties.
At the same time, section 90A of the Evidence Act 1950 permits computer-produced documents, including relevant electronic records, to be admitted in evidence where the statutory requirements are satisfied.
Malaysian courts have also considered evidential issues concerning WhatsApp messages in a number of cases.
In Shamsudin bin Mohd Yusof v Suhaila binti Sulaiman, the court confirmed that an agreement reached through WhatsApp can constitute a legally binding contract. Even where the parties have not signed a formal written agreement, the agreement may still be enforceable if the essential requirements for a valid contract under the Contracts Act 1950 are satisfied.
In Mok Yii Chek v Sovo Sdn Bhd, the High Court confirmed that WhatsApp messages fall within the meaning of “document” under the Evidence Act 1950. Accordingly, WhatsApp messages may be admitted in evidence in court, subject to the relevant rules of evidence.
However, the fact that WhatsApp messages can be admitted in evidence does not mean that any WhatsApp screenshot will establish that a contract has been formed.
In Mohd Azahar Abdul Halim v Naza Motor Trading Sdn Bhd, the court observed that reliance on WhatsApp messages still requires careful consideration of their authenticity and reliability. This includes whether the identities of the sender and recipient can be established, whether the time at which the messages were sent is clear, whether there is a risk of fabrication or alteration, and whether other, more reliable or more conclusive evidence supports the claim.
Accordingly, WhatsApp messages can indeed be used to prove a contractual relationship in appropriate circumstances. However, the court will still assess their authenticity, completeness and evidential weight by considering the messages themselves together with the other evidence of the transaction.
This is also why, from the perspective of business contract management, we do not recommend that businesses rely solely on instant messaging tools such as WhatsApp to confirm important commercial terms.
4. Is a Simple “OK” or “Agreed” Sufficient to Prove That a Contract Has Been Formed?
Not necessarily.
For example, someone may reply on WhatsApp:
“OK.”
Or:
“Agreed to proceed with the above arrangements.”
Without the full conversation before and after the message, it is difficult to determine exactly what that “agreement” relates to.
The parties may have agreed on the price while the quantity remains undetermined; they may have confirmed the goods while the payment period remains under negotiation; or they may have subsequently revised the terms of the transaction after a particular message was sent.
The court will therefore not automatically conclude that a contract has been formed merely because words such as “OK”, “Agreed” or “Confirmed” appear in the chat records.
The full communications before and after the message, together with the parties’ subsequent conduct, must still be considered to determine whether the parties genuinely reached agreement on the relevant terms of the transaction.
Where the chat records are also corroborated by quotations, purchase orders, delivery orders, invoices, payment records and other materials, they will generally carry greater evidential weight.
5. Who Sent the WhatsApp Message May Also Become a Key Issue in Dispute
Businesses should also be aware of another frequently overlooked question:
Did the person who sent the message have authority to make the relevant commitment on behalf of the company?
For example, an ordinary employee responsible for following up on deliveries may agree on WhatsApp to extend the payment period; a salesperson may promise an additional discount; or a project team member may agree to an increase in the scope of work.
After a dispute arises, the company may argue that the employee had no authority to vary the contractual terms on its behalf.
Accordingly, when determining whether the communications bind the company, the court may also need to consider the sender’s position, responsibilities and actual authority, the parties’ previous course of dealing, and whether the company subsequently accepted or confirmed the arrangements through its conduct in performing them.
Therefore, when using WhatsApp for business purposes, businesses need to consider not only “what was said”, but also “who said it”.
6. How Can a WhatsApp User’s Identity Be Established?
WhatsApp evidence also raises a very practical issue: how can it be established that the account or telephone number appearing in the chat records actually belongs to the other party?
In Malaysia, there is no separate set of evidential rules specifically governing proof of a WhatsApp user’s identity. Accordingly, when a party relies on WhatsApp chat records as evidence, it must address not only the admissibility of the electronic evidence itself, but also establish, through other evidence, a connection between the relevant telephone number or account and the person to whom it is attributed.
For example, this may be established by considering telephone number records, complete historical chat records, the parties’ previous methods of communication, transaction documents, witness testimony and the parties’ actual conduct following the conversations.
A WhatsApp contact name, profile photograph or a few isolated screenshots may therefore be insufficient, on their own, to establish the sender’s identity.
Where a business anticipates that chat records may become important evidence in future, it should, as far as possible, preserve the full conversations and retain other materials that link the relevant telephone number or account to the other party to the transaction.
7. Why Should Businesses Not Keep Only a Few WhatsApp Screenshots?
One of the most common responses by businesses after a dispute arises is to select a few screenshots from a large volume of chat records that they consider most favourable to their position.
This approach carries clear risks.
Cropped screenshots may omit important preceding or subsequent messages. For example, a customer may initially have agreed to a particular price, but the parties may later have renegotiated it. A message may appear to acknowledge a debt, while the full conversation may reveal that the precise amount remains disputed.
Isolated screenshots are also more likely to give rise to disputes over authenticity. The other party may question whether messages have been altered, deleted or taken out of context, or may even deny having used the account.
Accordingly, once a commercial dispute has arisen, the first step should not be to select a few of the “most favourable” screenshots, but to preserve the relevant communications and their context in full.
The relevant WhatsApp, WeChat and email records should also be retained together with quotations, purchase orders, delivery orders, invoices, payment records and other transaction documents.
Before employees change their mobile phones, leave the company or close company communications accounts, arrangements should first be made to preserve and hand over the relevant business records. If the original records are lost, proving the relevant matters may become more difficult, even if isolated screenshots can subsequently be located.
8. What Businesses Really Need Is a Complete “Chain of Evidence”
The absence of a formally signed contract does not automatically mean that a business cannot recover an outstanding debt. Conversely, having an invoice or a few WhatsApp screenshots does not automatically guarantee success in the case.
What truly matters in commercial litigation is whether the different items of evidence form a complete, coherent and mutually consistent chain of evidence.
For example, in a claim for payment for goods supplied, a business should ideally be able to answer the following questions:
Who proposed the terms of the transaction?
Who accepted those terms?
What was ordered? What was the price?
When were the goods delivered?
Were the goods received?
Were any objections raised about their quality?
How much has been paid? How much remains outstanding?
Did the other party subsequently acknowledge the outstanding debt?
Evidence addressing these questions may be found in quotations, WhatsApp messages, emails, purchase orders, delivery orders, acknowledgements of receipt, invoices, bank statements and the parties’ subsequent communications.
Where these materials corroborate one another, a business may still have reasonably comprehensive evidence of the contract and its performance, even without a formally signed contract.
Conversely, where chat records are incomplete, document versions are inconsistent, prices and quantities keep changing, or it is unclear whether the relevant individuals had authority to make commitments on behalf of the company, proving the case in court may remain very difficult despite a large volume of WhatsApp messages.
Conclusion
The absence of a formally signed contract does not automatically mean that no contractual relationship exists between the parties, nor does it automatically prevent a business from recovering an outstanding debt through litigation.
When dealing with such disputes, Malaysian courts may consider the parties’ WhatsApp messages, WeChat messages, emails, quotations, purchase orders, invoices, delivery and receipt records, payment records and actual conduct in performing their obligations as a whole, to determine whether a legally binding contractual relationship has been formed and to ascertain the terms of the contract.
However, from the perspective of business contract management and dispute prevention, we do not recommend that businesses rely solely on WhatsApp or other instant messaging tools to confirm prices, quantities, payment terms, delivery arrangements, contractual variations, inspection and acceptance, or other important commercial matters.
Where practical business needs require initial communications through WhatsApp, important matters should still be confirmed as soon as possible by formal email, purchase order, confirmation letter or contract.
WhatsApp can provide evidence, but it should not itself become a business’s contract management system.
What businesses truly need is a documentation system that fully records how transactions are agreed, how contracts are performed and how the amounts payable arise.
Once a dispute arises, preserving complete chat records, transaction documents and payment records at an early stage will better enable lawyers to assess whether a contract has been formed, what its specific terms are and whether the available evidence is sufficient to support the claim.
Disclaimer: This article is for general information only and does not constitute legal advice. Specific legal advice should be obtained based on the facts and circumstances of each case.
