Are E-Signatures Legally Binding and Enforceable?

In what is more and more a digital age, we are signing our contracts electronically. But are electronic, e-signatures, really as legally binding as normal, paper, hand signed signatures?

The irony is that e-signature are everywhere, and all of us have signed them and used them without giving much thought to them. But then, when people want to challenge the validity of a contract or agreement signed online, they will then try to allege the invalidity of a signature because it is an e-signature.

Yes, They’re Binding

E-signatures are legally binding, and it is almost inconceivable in today’s day and age that a court would invalidate an agreement, solely because the parties’ signatures were done electronically. Arguments like this have routinely failed in the courts. In fact, many federal and state courts themselves allow users and litigants to use e-signatures.

Claims of Forgery

What may have some merit are arguments that a signature was forged—in the world of e-signatures, this would mean that someone other than the person whose name appears on the signature line actually signed the document.

But courts have largely denied these claims as well. In some cases, courts looked to the verification process to refute claims of forgery. This is an important point—in more important contracts, information or uploading of identification information may help show that the e-signature is being signed by who it says it is being signed by.

Other courts have denied claims of forgery on the grounds that the parties’ course of action shows that they intended to abide by the agreement.

In other words, it is hard for someone to say their signature was forged, when that same person availed him or herself of the benefits and burdens of the agreement—the parties’ dealings and course of conduct indicate that they knew about and accepted the terms of whatever agreement it was which was e-signed.

Things can get very technical as well—computer forensic experts can be used to show that someone logged into their computer, or that their browser accessed the document, at a specific date and time to show that the person who signed the electronic signature is the correct person.

Same Legal Requirements as Paper Contracts

Note that although e-signatures are binding and legally acceptable, they still have to abide by the same rules as written contracts, and this is where parties tend to get in trouble.

So, for example, if the law requires that an arbitration clause in a larger agreement be signed separately, or that it be set out from the lettering and the font of the other parts of the agreement, so, too, must the e-signature document do these things. If a jury trial waiver must be in bold, and signed separately, so too, must the e-signature be “signed” separately.

If you do business online, make sure you know the laws that apply to digital commerce. Reach out to the West Palm Beach commercial litigation attorneys at Pike & Lustig for more information.

Sources:

docusign.com/products/electronic-signature/legality

oneflow.com/blog/are-electronic-signatures-legally-binding/