According to e-signature laws around the world, documents that are signed electronically have all the same legal protections as those that are signed with a pen and paper. Despite this, many businesses interested in obtaining e-signatures on contracts and other important paperwork still have concerns over whether these electronically executed documents will be defensible and admissible in court.
In the United States, judges have ruled for e-signatures time and time again. Thanks in large part to the E-SIGN Act, which states that transactions should not be “denied legal effect” solely because of their electronic form, businesspeople and consumers can have full confidence that their e-signatures are legally valid. As long as an electronic signature is obtained in the appropriate way, using compliant technologies, certifications, and authentications, it will have full validity under the law. But will the document be admissible in court and will a judge enforce the terms of the contract?
Validity, Admissibility, & Enforceability
Businesspeople and consumers should know that legal validity, court admissibility, and enforceability are not the same thing. Each concept has a distinct definition, set of requirements, and, most importantly, contribution to the outcome of a legal dispute.
The E-SIGN Act states that signatures should not be denied legal validity solely because they are electronic, which means that a contract that is signed electronically can be brought into trial. However, a judge’s willingness to accept that contract will depend on how the electronic document was signed.
Certain criteria must be met in order for an e-signature to be admissible in court. Any person who hopes to present an electronically signed contract in front of a judge needs to be able to prove the intent of the signatory and the security of the signed document. If the document could have been tampered with or altered in any way after it was signed, there is a high likelihood that a judge will refuse to allow it to be admitted in court. Specifically, an e-signed document may be legally valid but ruled inadmissible in court due to weaknesses in security, audit logs, or authentication. This is why it is critical that businesses select an e-signature solution that is highly reputable and meets the highest standards of technical integrity.
Lastly, the enforceability of a contract depends not only on its validity and admissibility, but also the contents of the agreement itself. In a dispute, a judge may examine whether: the terms of a particular agreement were clear and consistent, there was consideration (an exchange of value between parties), the parties had legal capacity (ability) to sign, whether a party was under duress or undue influence, and whether a party signed by mistake or without knowledge of the agreement’s meaning. Most businesses have an attorney draft or review their agreements prior to execution with these criteria in mind, in order to maximize enforceability in the future should the contents of the document face scrutiny in court.
Criteria for Admissibility: Document Authentication
In examining the admissibility of an e-signed document in court proceedings, a judge will analyze the security, auditing, and authentication protocols of the e-signature technology and process. The first criteria is being able to prove that the document was not tampered with in any way, ensuring that the terms each party agreed to are the same as how the document appears in court.
The first step in establishing the authenticity of an e-signature document is with data security. An e-signature system should be fortified with bank-level security protocols to ensure that documents and audit records may never be tampered with or accessed by unauthorized parties. If there is any security vulnerability which provides credence to an argument that an executed electronic document’s integrity may be questionable, a judge may rule the document inadmissible.
While data security helps prove that your document was not tampered with by an outside party, other security measures help prove that the document remained consistent from how it was signed to how it appears in court. Timestamped audit logs enable parties, including the court, to verify when a document was created, viewed, signed, and archived. Audit logs should be detailed and secured with a digital fingerprint, checksum, or similar method to ensure they remain tamper-proof.
Some e-signature providers show the audit log of each document with a signature certificate appended to the end of each document. Court-admissible signature certificates offer judges and legal professionals a way to view and verify a document’s validity data, audit logs, and signatory information — such as full name, signature, IP address, email address, and any other identifying details. Signature certificates are a significant component in authenticating signed documents in court.
Criteria for Admissibility: Signer Identity Verification
The next step in proving the validity of your document in court is to be able to successfully argue that the document was signed by the apparent parties. While this might sound difficult in online software technology where your signers are not present with you when they signed, e-signatures often include several identity verification features for just this kind of scenario, including the following:
Biometric authentication identifies people based on intrinsic physical traits. RightSignature, for example, has a proprietary biometric authentication technology that captures unique characteristics related to the speed and timing of a person’s signature. This type of data is representative of a particular person’s physical movements and establishes the proof of the signer’s identity and intent if either are questioned in court.
Email and IP Addresses
By confirming access to a particular email account and capturing an IP address, e-signature systems are able to link the identity of a signer to the computer and software used in the electronic signature event.
Webcam Photo Authentication
Some e-signature providers even allow signers to take a picture of themselves and attach it to the contract as they sign. This personal touch helps add an additional level of document authentication to an already secure process.