While electronic signatures are widely used these days, there is still an element of hesitation when we are evaluating them, especially for legal paperwork. This article should hopefully clear up all of that.
“Electronic Signature” – The term means an electronic sound, symbol, or process, attached to or logically associated with a contract or other record and executed or adopted by a person with the intent to sign the record.
The laws for electronic and digital signatures in the United States are fairly straightforward. The United States Electronic Signatures in Global and National Commerce (ESIGN) Act states that an electronic signature can be considered to be valid as long as they comply with the following requirements: (a) show intent to sign the agreement; (b) establish that there was consent to do business electronically which could be done by analyzing the circumstances; (c) the system used to create signature must maintain a record of how the signature was created or that the document was executed using an electronic signature; and, (d) the electronic signature records must be capable of retention and reproduction for future reference.
The Uniform Electronic Transactions Act (UETA) states that (a) a contract cannot be denied legal enforceability on the grounds that an electronic record was used to create it; (b) a record or signature cannot be denied legal effect or enforceability because of its electronic form (c) if a law requires a record to be in writing, an electronic record satisfies the law and (d) a law requires a signature, an electronic signature satisfies the law.
New York and Illinois have not adopted UETA.
European Union Regulation No 910/2014, commonly known as Electronic Identification and Trust Services for Electronic Transactions (eIDAS) governs the modalities of electronic signatures in Europe and the United Kingdom. One of the objectives of this regulation is to remove existing barriers to the cross-border use of electronic identification means used in the Member States to authenticate, for at least public services.
The regulation creates categories of electronic signatures to address the different levels of electronic signatures. They have provided definitions for three types of esignatures - Electronic signature, Advanced electronic signature and Qualified electronic signature. They could vary from a simple name in an email to a signature attached by using an external device that only the holder/owner has access to.
Similar to the EU, electronic signatures are recognized in a tiered manner. When it comes to the most basic signature mechanism (like the email example mentioned above) the signatory could be asked to prove, either by itself or with additional evidence that a method was used to identify the person and to indicate that person’s intention in respect of the information contained in the electronic record’.
While they are completely valid for all your business purposes, electronic signatures are generally not legally valid for the following types of legal documents:
• Adoption papers
• Any court documents
• Divorce papers
• Your will or testament
Absolutely! Our aim is to ensure that we take away all the heavy lifting when it comes to contract work. SpotDraft provides the highest standard of protection to your documents. It protects the legality of your electronic signatures by preserving an audit trail. The audit trail consists of signatory names, email addresses, signatory IP addresses, trusted timestamps and status of completion.
There are some discrepancies in certain jurisdictions with certain esignature software. It is always good to ensure this box is checked, and you are good to go!
While esignatures are a super important step in digitizing your contracts, it is far from the only one. There is a universe of automation that can make contract work seamless and fast. If you are interested in how SpotDraft can power your legal team, just let us know and we’d love to give you a tour.