Who hasn’t sent a typo when texting?

I plead guilty. Texting is quick, but sometimes (perhaps often) I don’t see my mistake until just after I have sent it. And it’s not just me – errors are so common that many people include comical explanations in their signature blocks. https://www.linkedin.com/pulse/excuse-my-typo-signature-lines-collection-pravash-pujari/

But joking aside, not only do grammarians criticize sloppy texting

(https://contentbureau.com/resources/copywriting-tips/excuse-your-typos-no-i-wont-actually), but business websites also point out the “IRL” risks from using texts for important messages.  https://www.inman.com/next/sent-from-my-iphone-please-excuse-any-typos-and-5-other-text-bombs-youre-making/

But aren’t text typos just an inevitable – and harmless – risk of modern life, like a misaddressed email was, all the way back in 2005?

A recent Canadian court did not see it that way – and held an emoji sender liable for a $62K contract, based on his “thumbs up” emoji. https://www.businessinsider.com/judge-ruled-thumbs-up-emoji-can-represent-legally-binding-agreement-2023-7

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(Although the case was decided under Canadian law, the contract formation principles should be familiar to any first-year contracts law student in this country.)

A “thumbs up” emoji (https://emojiguide.com/people-body/thumbs-up/) was a commodities buyer’s response to a request from a business colleague to “please confirm flax contract”. In court, the buyer claimed that he only wanted to confirm receipt of the contract, rather than acceptance. But the seller – and the court – treated it as a binding acceptance of an offer to sell, a familiar contracts law analysis.

To me, the crucial fact for the court was not just the use of an emoji text to form the contract, but also the parties’ “pattern” of conduct, in other commodities deals, over a period of time. The court explicitly equated the emoji to the parties’ prior verbal exchanges such as “ok”, “yup” or “looks good” – which neither party disputed had actually created contracts. As the court described it, these were  “uncontradicted proof of the manner in which the parties conducted their business”.

In a world where seemingly everyone texts, at all times and for all purposes, “this Court cannot (nor should it) attempt to stem the tide of technology and common usage – this appears to be the new reality in Canadian society and courts will have to be ready to meet the new challenges that may arise from the use of emojis and the like”.

As a result, that quick thumbs-up emoji response cost the sender $61,498.09, plus interest and costs.

As a business attorney, I know from long experience that a sad tale such as this will not stop clients from doing business in the way they prefer – and I can’t deny seeing “ok”, “yup” and “looks good” in our clients’ messages. But I can let them know the potential cost of such business shortcuts. I just hope that I can convince them that what works well for setting a tee time should not be the way to make expensive contracts – especially when a simple, “old fashioned” phone call, or even a Stone Age email, can eliminate any uncertainty, and risk.

For further information, please contact Stanley Jaskiewicz, Esquire, of our Business Law department at sjaskiewicz@sgrvlaw.com, or 215-241-8866.

Pennsylvania’s Act 122 updated our corporate laws at the end of 2022. Much of the 123-page, single-spaced collection of “omnibus amendments” reads like a detailed proofreading job, cleaning up glitches in the codification of our corporate laws.

However, there are some noteworthy substantive changes, primarily affecting nonpublic firms.

Bankers and SBA staffers may soon have that hangover, of their own making. I am speaking, of course, about the Paycheck Protection Program debt hangover – 11.7 million loans created to be forgiven. Everyone knows that forgiveness is hard – hard to request, and, often, even harder to grant – especially when big money is involved. But who could have imagined the challenges of walking away from $400 billion in bank debt?

(Actually, the total amount began as $800 billion, before loans already wiped off the books.)

To try to chip away at that mountain of, literally, debt, the Small Business Administration recently created its “direct forgiveness” portal (https://dfussbaforgiveness.zendesk.com/hc/en-us), for loans under $150,000.00 – over 90% of all PPP loans. That sheer volume has, reportedly, delayed completion of bank forgiveness approvals – 11.7 million separate applications must be filed, reviewed and processed.

To try to break the backlog, the Small Business Administration recently created a new portal (open on August 4, 2021) for “direct” forgiveness by the SBA, rather than by the bank lender. To avoid the appearance of cutting into lender/borrower relationships, the SBA quickly clarified that it will not take “over the forgiveness decision responsibility from the lender.”

Instead, according to the SBA, “Lenders retain responsibility for making the loan forgiveness decision. SBA is simply providing a proven, user-friendly platform on which borrowers may submit their forgiveness applications and lenders will submit their forgiveness decisions to SBA.”

If so, why go to the expense of reinventing the loan forgiveness wheel – and adding a new step to what has been a convoluted process?

Lenders must also choose to “opt in” to the portal, presumably to avoid the cost of creating their own review process – a procedure lenders already do every day, for all loans. Veterans of the PPP scramble in 2020 may also question the characterization of the SBA software as “proven.” Moreover, many lenders may have already incurred costs to build their own forgiveness software. In fact, the 60-day deadline for lenders to process forgiveness applications, and constantly changing program rules (including predictions of expedited procedures), may even have led some lenders to delay the start of processing of their own forgiveness applications.

Why incur unrecoverable costs today, that may be avoidable tomorrow, under the next attempt at simplification? Whatever the reason, many lenders have already declined to participate in the SBA’s direct forgiveness procedure, in favor of their own portals. From a lender perspective, direct forgiveness also eliminates a major incentive to participate in the PPP program – new customer relationships. A bank can’t promote its fee-based services if the customer deals only with the SBA, rather than with a bank relationship officer. Keeping the forgiveness process “in-house,” in contrast, preserves that relationship-building opportunity, in the context of a success experience for the PPP borrower (loan forgiveness).

Lenders must also monitor the new SBA portal for information about the loan status. Without affirmative SBA reporting of loan status, however, bank auditors and compliance officers must regularly check the forgiveness portal before issuing routine financial statements or reports – a lender headache, especially for smaller PPP loans with little or no margin to recover monitoring and forgiveness expenses. If those loans were marginally profitable before this direct forgiveness program, how much more so will they be with these additional expenses? Regardless whose software is used, of course it will work, seamlessly – doesn’t all software perform as intended, out of the box? Perhaps the banks that have “opted out” of the SBA portal don’t want to risk their reputation with borrowers on the quality of the SBA’s new software code (or the SBA’s “real time” quality control of it).

SBA Associate Administrator Patrick Kelley well stated what may be bank lenders’ frustration:

Give it over to the government and get your life back. All of us want to be done with forgiveness — borrowers, lenders, government — by the fall, across the board. So this is the final push that will hopefully put PPP in the rearview mirror for the borrowers, for the lenders and for the agency.

Will we soon have to do it all over again, if a portal is created for larger PPP loans? Or for the required lender verification of borrower revenue loss eligibility for Second Draw PPP loans? To continue the “hangover” metaphor, perhaps the new portal is just the proverbial “hair of the dog” – let’s just get the PPP loans off society’s books, and let banks return to “real” loans.

To discuss this or other issues involving the Paycheck Protection Program, please contact Stanley P. Jaskiewicz or the SGRV Corporate Group at 215-241-8866.

Despite our progress on reducing infections and deaths from COVID-19, we still seem stuck with one aspect of the Pandemic: ever changing rules. (I wrote about 2020’s challenges at https://www.sgrvlaw.com/the-paycheck-protection-program-what-a-long-strange-trip-its-been/.)

In today’s race to “get back to normal”, however, businesses again face the same frenetic pace of change – but now at the same time as they try to recover from the shutdown. In recent days, businesses and nonprofits had to digest new rules for schools (https://www.cdc.gov/coronavirus/2019-ncov/community/schools-childcare/index.html), employee safety (Federal Register :: Occupational Exposure to COVID-19; Emergency Temporary Standard), and, of course, the ever-changing mask mandates (Pennsylvania’s universal mask mandate lifts Monday, but businesses can still require them – Philadelphia Business Journal (bizjournals.com)), all in real time – and the list could go on.

Businesses must also balance whether it is worth trying to get any of the massive amount of relief money that is still available (Small-business COVID-19 stimulus funds: What’s still available? (inquirer.com)), against the risk of criminal prosecution if the funds may later be deemed not “necessary”, with 20 – 20 hindsight.

(That choice just became easier with the Small Business Administration’s abandonment of its “loan necessity” questionnaire.  SBA officially drops PPP Loan Necessity Questionnaire requirement – Journal of Accountancy)

But all this talk about “normal” seems more than a bit surreal. After all, the virus is still here.  It is even surging in some parts of the country. People are still getting sick – and dying. Businesses must still devote time to try to keep up with all the rule changes. If all those burdens were not enough, PPP loan forgiveness deadlines are looming, albeit with promises of even easier procedures. SBA preps new PPP loan forgiveness portal for small businesses – Philadelphia Business Journal (bizjournals.com)

Unlike in 2020, however, at a personal level we now have safe and effective vaccines to protect us – for those who choose to be vaccinated. Some are skeptical about their safety, and prefer to “wait and see” – or even to risk avoiding vaccination totally.  Moreover, many are not yet eligible for a shot.  Children, in particular, and those with compromised immunity (such as transplant recipients) remain at risk. (The tests leading to the vaccines’ approval did not include children, although trials are ongoing.)

From an even broader perspective, there are not enough doses for much of the world. Calls for booster shots seem like first world privilege (https://en.wikipedia.org/wiki/First_World_privilege) to those who are still waiting for their first or second shot. And the vaccinated in the first world should care about this – quite a lot, actually. The virus doesn’t care where a potential victim lives.  A mutation in an unvaccinated person in Africa or South America could lead to an infection in the US or Europe that mutates to bypass the vaccines’ protection.

In short, according to Yale infectious disease physician Dr. Jaimie Meyer:

Even though we very much want this pandemic to be over … the fact that some people, including children, aren’t vaccinated means we’re still vulnerable. … While it might be exhausting to continue to take precautions, especially for unvaccinated kids, that becomes increasingly important.

Looking ahead, therefore, businesses’ desire to be done with virus and virus precautions, and get back to business – will not simply “make it so”, despite all our progress so far (with apologies to Captain Jean-Luc Picard). Although skipping protections – eating out without a mask, or attending a concert – may be less risky today than it was in 2020, business compliance costs and burdens have not gone away.

In the face of that reality, perhaps Nirvana’s “Feels Like Teen Spirit” offers a better soundtrack for 2021 than my high school anthem in the title of this alert: “I feel stupid and contagious.”

Copyright 2021 Stanley P. Jaskiewicz, Esquire