Full Time Result: Court of Appeal rules email exchange constitutes a legally binding contract in high profile sports rights dispute

The Court of Appeal has upheld a decision by the Commercial Court confirming that a binding contract was formed between DAZN and Coupang for the sub-licencing of broadcast rights to the FIFA Club World Cup, even though no formal written agreement was signed.

Background

The FIFA Club World Cup took place earlier this summer. FIFA, the sole owner of the broadcasting rights, had licensed those rights to DAZN, which was authorised to sub-licence them in different territories across the world.

Coupang, a South Korean e-commerce and streaming platform provider, entered into negotiations with DAZN to acquire the rights for distribution in South Korea. These negotiations occurred primarily via WhatsApp, culminating in Coupang sending a formal offer by email on 27 February 2025. The offer covered essential terms: rights, territory, exclusivity and price.

DAZN replied on 3 March confirming acceptance of Coupang’s offer, and indicated that it would begin drafting a written agreement:

“I am pleased to inform you that we will accept Coupang Play’s offer for the FIFA Club World Cup 2025 we will start contract drafting and hope to share the draft for your agreement soon”

Shortly after, it had emerged that another South Korean company, Naver, had submitted a competing offer almost $3m higher. DAZN appeared ready to accept this alternative bid.

The Dispute

Coupang’s position was that a binding contract had been formed, and it brought a claim in the Commercial Court on that basis. The Court agreed, granting an order for specific performance. DAZN appealed, arguing that no contract had been formed because any agreement was subject to the execution of a formal written document.

The appeal

DAZN’s appeal relied on two main grounds: (1) Coupang’s email on 27 February did not amount to a contractual offer; and (2) there was no intention to create legal relations by the exchange of emails, the parties intended to be bound only upon signing a formal agreement.

The Court of Appeal rejected both arguments. It found that the email on 27 February did amount to an offer. It considered previous correspondence between the parties where DAZN had informed Coupang it must make an offer by 27 February and had communicated the minimum payment required to secure the rights. The offer set out a summary of the main deal terms and, significantly, it did so in the form of an email, the first email communication between the parties about the deal, which suggested a move to a formalisation of Coupang’s offer.

The Court also rejected the argument that there was no intention to create legal relations until a signed agreement was concluded and provided numerous reasons for this, including: (1) the parties had not qualified their discussions with the words “subject to contract” or any equivalent, a phrase that DAZN used on draft agreements with others; (2) the parties had agreed the essential terms; and (3) it was the norm in the industry for negotiations by informal means to be followed by a formalisation email.

Key takeaways

The decision is a key reminder that a signed agreement is not required to create a legally binding contract, and how an exchange of informal communications can create a binding agreement if the essential terms are agreed by the parties.

Phrases like “subject to contract” remain a key safeguard where parties do not wish to be bound before an agreement is signed. Where this is omitted, the risk of becoming legally bound before signature is magnified.

Find out more about Gordons’ expertise in commercial contracts here.