Electronic signatures are becoming a vital business tool in today’s remote sales environment and some consumers are still unsure of the legal boundaries when it comes to the authenticity of an eSignature when compared to a traditional wet signature.
When digitalizing the sales process by incorporating electronic signature it is important to have a proper digital transaction management system. For example - having a document is just the beginning, the system then needs to save a copy of that document to your computer, email a copy of the document to a customer and then render a new version of the document which is return to both parties. You could argue that there are now multiple versions of the original document. Without the appropriate technology - it would be almost impossible to effectively demonstrate who holds the latest version of the completed document and which one was the original which was signed.
Yes, it can. Authenticity is easier to prove, in fact, thanks to built-in digital audit trails which are time stamped, dated and have further inputs like IP address, browser details and device description.
How will an electronic signature hold up if challenged in court?
Courts can be charged with establishing whether a signature is valid and attributing it to the signer, based on an evidentiary burden of proof. A digital audit trail supports this in a way that other methods can’t compete with, because the data captured around an electronic signature provides more concrete evidence around the authenticity of someone’s signature, and thereby their obligations under a contract, it is easy to demonstrate this legal burden of proof.
When investing in an eSigning solution, it's important to choose one that provides and creates a comprehensive transaction trail between signing parties, to provide you with transaction history. It is also important that the solution tracks and timestamps various information from the moment the document is submitted for signature to when it's completely signed and secured. To ensure that any tampering of your transaction log is detectable, the solution should have a transaction log with hashing technology. This audit trail gives you a full evidence log to bring to court if any conflicts arise.
In 2014, the European Parliament repealed the eSignature Directive (1999/93/EC) with the goal of creating a more uniform market for electronic transactions. The replacement was the EU Regulation No 910/2014 on electronic identification and trust services for electronic transactions in the internal market, also known as eIDAS.
Electronic commerce laws dictate how electronic chattel paper is to be managed as it is presented, executed and retained. These laws include E-Sign Act UETA and UCC Section 9-105.
The Uniform Electronic Transaction Act (UETA) and the Federal Electronic Signatures in Global and National Commerce Act (ESIGN) empower electronic documents and electronic signatures so they can be used to the same extent as paper documents and ink signatures. These two laws formally define an electronic signature as “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.