Social Media And Unorthodox Contracts ( Retweets, Likes And Shares For A Price Or Reward ) : Enforceable Or Not?

The digital age has transformed how we communicate, conduct business, and form agreements. Social media platforms have become marketplaces where offers are made with a tweet, acceptances occur with a click, and consideration flows through retweets and likes. But when someone tweets "Retweet this and I'll send you $500" or "First 100 likes get a free product," have they created a legally binding contract? This question sits at the intersection of centuries old contract principles and 21st-century technology. As courts worldwide grapple with these issues, businesses and individuals need to understand when social media interactions cross the line from casual engagement to enforceable legal obligation.

Before examining social media's uniquely challenges, we must revisit the fundamental elements of contract formation. These principles, developed over centuries of common law, remain the foundation for analyzing any agreement, regardless of the medium through which it's created.

For a contract to be enforceable, courts require:

1. Offer: A definite proposal communicated to an identifiable party, demonstrating present intent to be bound. As established in Carlill v. Carbolic Smoke Ball Co. [1893] 1 QB 256[1], offers can be made to the world at large, not just specific individuals.
2. Acceptance: This can be described as an unqualified agreement to the terms of the offer. The mirror image rule requires acceptance to match the offer exactly as held in the case of Butler Machine Tool Co Ltd v Ex-Cell-O Corp [1979] 1 WLR 401)[2].
3. Consideration: This is something of value exchanged between parties. As held in the case of Thomas v. Thomas (1842) 2 QB 851[3]; consideration need not be adequate, only sufficient. Courts don't assess whether parties made a good bargain, only whether something of legal value was exchanged.
4. Intention to Create Legal Relations: Parties must intend their agreement to have legal consequences. In commercial contexts, this intention is presumed as seen in the case of Edwards v. Skyways Ltd [1964] 1 WLR 349[4], meanwhile, as held in the case of Balfour v. Balfour [1919] 2 KB 571[5]; there is a rebuttable presumption that in social and domestic arrangements agreements are non-binding.
5. Capacity to contract : that the parties involved in the agreement have the legal capacity under law to do so. 

A critical look at Social Media Agreements. 

Courts don't examine what parties secretly intended but rather how a reasonable person would interpret their words and conduct (Smith v. Hughes (1871) LR 6 QB 597)[6]. This objective approach becomes particularly significant in social media contexts, where tone, context, and seriousness may be ambiguous. Several cases demonstrate that courts will enforce social media-based agreements when traditional contract elements are satisfied.

In the recent decision of McBride v McBride [2024] NSWSC 45[7], the Supreme Court of New South Wales considered whether the plaintiff's words in a video posted to multiple social media sites constituted a settlement offer. The Court found that although it is possible to use social media to make an offer, this particular video did not meet the threshold requirements for a settlement offer. However, the court did acknowledge and establish that the medium of communication doesn't invalidate an otherwise enforceable agreement. 

In the Australian case of , ATL (Australia) Pty Ltd v Cui [2022] NSWSC 1302[8], the Court held that text messages which were sent via a social media platform named WeChat, which discussed the possibility of settling the dispute, did not create a binding agreement, as the parties had not agreed on all key terms of the bargain, and the circumstances indicated that the parties did not intend to be bound until the parties had reached an agreement.

Kanye West, an American rapper, acts as a cautionary tale of how a social media post can have significant legal consequences. In 2016, Kanye West made a "tweet" that his upcoming album would only be available on the music streaming platform named Tidal, with the tweet stating "My album will never never be on Apple. And it will never be for sale… You can only get it on Tidal". As a result, a large number of fans subscribed to the platform in anticipation of the album release. However, a month or so after the album was released on Tidal, it was also made available on other streaming platforms such as Apple Music and Spotify. A class action lawsuit was brought against Kanye West and Tidal which alleged that Kanye's "tweet" was misleading and had tricked customers into subscribing to Tidal. The class action was subsequently settled for a whopping US$84 million[9].

The Carbolic Smoke Ball Precedent: Why It Still Matters

The case of Carlill v. Carbolic Smoke Ball Co.[10] remains the most relevant historical precedent for social media contracts. The Carbolic Smoke Ball Company advertised that it would pay £100 to anyone who used its product as directed and still contracted influenza, and deposited £1,000 in a bank to show sincerity. Mrs. Carlill used the product as directed, contracted influenza, and sued for the reward. The company argued there was no contract because: The offer was too vague, there was no notification of acceptance, there was no consideration. The Court of Appeal through Lord Justice Lindley established; “that offers can be made to the world at large, and anyone who performs the required conditions accepts the offer. This principle applies directly to social media offers like "First 10 retweets win a prize."

Lord Justice Bowen also found that the deposit of £1,000 showed serious intent, distinguishing the offer from mere advertising puffery. Similarly, when businesses make social media offers, courts examine whether a reasonable person would view them as serious commitments. Further, the court held that using the product as directed (inconvenience and potential detriment) constituted sufficient consideration. This reasoning extends to retweets and likes, which provide promotional value. The Carlill framework suggests that many social media offers satisfy contract requirements: they're communicated to the public, acceptance occurs through performance, and consideration exists in the promotional benefit.

Not every social media post creates legal obligations. Courts must determine whether parties intended to enter into legal relations. Social media "do X, get Y" promises typically create unilateral contracts, where acceptance occurs through performance rather than a return promise. In Carlill, the court established that unilateral contracts don't require notification of acceptance; performance itself constitutes acceptance. When someone tweets "Retweet this for a prize," they're making a unilateral offer. The first person to retweet accepts through that action.

When businesses post offers on social media, courts presume they intend to create legal relations (Edwards v. Skyways Ltd)[11]. This presumption is difficult to rebut. Companies cannot escape liability by claiming their social media manager was "just being friendly" or "didn't mean it seriously."

Individual social media users making casual statements generally don't intend legal consequences (Balfour v. Balfour)[12]. Courts recognize that people engage in hyperbole, jokes, and casual banter online. In such situations the Courts apply an objective test: Would a reasonable person, viewing the post in context, believe it was a serious offer intending legal consequences? Factors courts consider in determining that may include; Identity of the Offeror, Specificity and Clarity, Language and Tone, Past Conduct (Has the offeror honored similar commitments previously? A pattern of honoring social media offers evidences intent to be bound). Deleting a tweet doesn't necessarily revoke the offer if people have already seen and acted on it. Screenshots preserve evidence of offers even after deletion.

In essence, when it comes to the question of the enforceability or otherwise of agreements made on social media, the court will enforce it if the fundamental elements of a valid contract (offer, acceptance, consideration, intention to create legal relations and capacity to contract) are present. Thus, it is important to take a moment, to be sure of what you want to put on social media before hitting that “POST” button. 

[1] Carlill v. Carbolic Smoke Ball Co. [1893] 1 QB 256

[2] Thomas v. Thomas (1842) 2 QB 851

[3]Thomas v. Thomas (1842) 2 QB 851

[4]Edwards v. Skyways Ltd [1964] 1 WLR 349

[5]Balfour v. Balfour [1919] 2 KB 571

[6](Smith v. Hughes (1871) LR 6 QB 597).

[7]McBride v McBride [2024] NSWSC 45

[8]ATL (Australia) Pty Ltd v Cui [2022] NSWSC 1302

[9] Timothy Seton, Isabella Johnston and Amelia Sakaris, Content Creator or Contract Creator - Can social media posts constitute legally binding offers? – 12 March, 2024.

[10]Ibid [1893] 1 QB 256

[11]Ibid [1964] 1 WLR 349

[12]Ibid [1919] 2 KB 571