Are e-signatures valid?

Now that law firms are finally embracing technology as part of their day-to-day operations, is it now time to make e-signatures valid and legally enforceable?

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Going back to good old contract law, a paper signature is supposed to be a person’s name, written in their own hand on a piece of paper, that includes crosses, initials and stamps, so as to personally authenticate the document. However, can an e-signature be valid in the same way?

A recent article by Hall & Wilcox pointed out that while it is convenient to execute legal documents with an e-signature, the facts and issues of enforceability and security need to be taken into account. A key message here was that yes, it is possible to use an e-signature, but measures should be taken to verify the person whose signature it is, and whether they consented to executing it that way.

That brings me to the toss up of whether the favourable elements of using e-signatures outweigh the unfavourable ones. So let’s have a look:

Favourable:

  • They save time (and paper) by eliminating the need to print things off and put them in the mail, thereby speeding up the process.
  • It only takes a click of a button to insert them.
  • You don’t have to actually sign. You can ‘sign’ by printing your name, initials, or special stamp.

Unfavourable:

  • They’re subject to technical difficulties. That’s right, when your internet goes down (which it inevitably will one day, as technology is far from perfect), there goes your paperless e-signatures until it comes back.
  • Fraud alert! E-signatures are very, very susceptible to fraud and dodgy behaviour.
    • It doesn’t personally identify the party, or whether they approved, therefore how is someone to know that the actual person has authorised it?
    • They are not physical objects, so therefore can be removed and replaced. Therefore hackers, or someone who has access to the system, can affix it to something in their favour.
    • The contents of the document can be easily altered while the signature stays.

So it seems like the induction of e-signatures requires special measures to make sure the unfavourable items don’t end up costing the company a lot of time and money. So should they be made useful in all legal practices? I’ll leave this one up to you guys. Let me hear your opinions.

Like what you read? Share or leave me a comment.

Signed,

The [Pre]Lawyer in Black

 

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