If we needed to hand-sign every agreement we made online and offline, we’d have a bureaucratic nightmare.
We’d have to put pen to paper for every online service we signed up for, and any subscription we subscribed to. We’d waste forests of paper in signing contract after contract, agreement after agreement.
Fortunately, we have electronic signatures that can rescue us from this nightmare. But what exactly is their legal status?
What are Electronic Signatures?
Electronic signatures allow you to give permission quickly and easily, without needing to sign agreements by hand.
This type of signature isn’t just typing your name on the signature line of a PDF, or scrawling your initials with a stylus. It also includes clicking an Accept button on a website. An electronic signature is a marker, or a process, that indicates your intent to abide by the contract.
[An electronic signature is an] electronic sound, symbol, or process attached to, or associated with, a contract or other record and adopted by a person with the intent to sign a record. (U.S Electronic Signatures in Global and National Commerce Act)
Electronic signatures of this kind are generally seen to be legally binding (more on this later), but they are not to be confused with digital signatures.
Electronic Signatures Are NOT Digital Signatures
Despite most people assuming electronic signatures and digital signatures are synonymous, they are not.
Digital signatures are sometimes called advanced electronic signatures. These are usually signatures generated by a computer. Using strong encryption methods (such as asymmetric cryptography), they can be used to secure documents.
Where electronic signatures can easily be forged, digital signatures cannot. A digital signature is embedded in that document and linked to the identity of the person who signed it. This makes them especially useful for verifying exactly who signed a document, and for ensuring a document has not been changed since it was signed.
On its own, a digital signature is not a sign of intent, and is therefore not always legally binding. But a digital signature can be used to verify, secure, and authorize a legally binding electronic signature.
For the average user, electronic signatures are easier to implement as we will see below. But the signature may not be secure. Digital signatures ensure the integrity of the data, and thus are combined with electronic signatures for ironclad documents.
The e-signature solution company Esignlive.com, uses a simple infographic to explain these crucial differences.
What’s Their Legal Status?
Let’s take a look at the legal status of electronic signatures in a few different countries. If your country isn’t in the list below, Adobe has a comprehensive list of the legal status of electronic signatures in a range of countries here.
Please Note: MakeUseOf is not a legal service provider, and cannot be held responsible if any of the below information is incorrect. Consult the documents listed, or a qualified lawyer if you need further information.
Are They Legal in The US?
Rules around the legality of electronic signatures in the US are largely based on the Uniform Electronic Transactions Act (UETA) and the Electronic Signatures in Global and National Commerce Act (ESIGN).
47 states have based their laws on UETA meaning that electronic signatures are legally binding for almost all forms of agreements (provided all parties agree to accept electronic signatures). Exclusions include property transactions, some notices to consumers, and wills, which will still require a hand-written signature.
Are They Legal in the UK?
The UK treats electronic signatures similarly to the US, with rules being set out in the Electronic Communications Act 2000.
If you show your intent to agree to a document in any electronic form, this is legally binding (whether or not you used a digital signature for authentication).
As is the case in the US, you are advised not to use electronic signatures for property agreements, wills, and in other cases such as divorce and marriage.
Are They Legal in Canada?
As set out in Personal Information Protection and Electronic Documents Act, SC 2000, c 5, electronic signatures are treated in pretty much the same way as handwritten signatures if all parties have agreed to accept them.
Again, exceptions include real estate contracts, and wills.
Are They Legal in Australia?
Laws around electronic signatures in Australia are based around the Electronic Transactions Act 1999.
Almost all electronic signatures are legally enforceable, apart from those relating to citizenship and migration. Different regions of Australia also have varying views on the legality of electronic signatures in relation to real estate, wills, and power of attorney agreements.
Are They Legal in India?
In India, electronic signatures are indeed legally binding (unless there is proof that the signature was used unlawfully). And so are digital signatures. The Indian government allows companies to choose which type of signature is best for them.
That being said, digital signatures have to adhere to strict standards to be seen as enforceable. More details on these standards can be found in The Information Technology Act 2000.
Exceptions to this include any documents that must be written on stamped paper, wills, and property transactions, among a few others.
Using Your Electronic Signature
Most times you provide an electronic signature, you’ll barely notice. When you click I accept while signing up to an online service, or when you agree to Facebook’s new terms, you’re electronically signing a legal contract.
For those times where you actually need to sign a document (such as a downloaded PDF), you can still do this electronically. Speaking with PCWorld, Dallas copyright attorney Bhaveeni Parmar, explains all the options in the article.
The “least bulletproof” option is to add an image of your signature to the document. If you’re signing a DOCX document, you can insert an image of your signature into the document within Microsoft word, or Google Drive. If you’re signing a PDF document, there are plenty of applications that allow you to edit these PDFs (i.e. inserting your signature). If you have a stylus, you could even sign a PDF “by hand” on your iPad.
The next class of signatures is typing your name within a form. In US states that have adopted UETA or ESIGN, this is a legal electronic signature. For “lower-priority” documents, typing your name in one of the following formats is:
Considered to be [a] legitimate signature under the Federal E-Sign act, and acceptable enough for the legal industry
- For submissions to the Federal court system: /s/Angela West
- For submissions to the Patent & Trademark Office: /Angela West/
Finally, the most secure option is to use a dedicated service such as Adobe Sign or DocuSign (among many others). These options allow you to sign important documents securely using high-end encryption technology. They also take into account the laws of the country for which the contract is meant.
The Fastest Ways to Use E-Signatures
To run through just a few of these:
- If you’re happy just inserting an image of your signature onto agreements, Signature Maker allows you to scrawl your signature within your browser, then download the signature file as an image.
- For something more secure, SignEasy (iOS, Android) is one of the most popular mobile apps for completing and signing a wide array of file types including PDF, Word, and Excel (see the image above). Once signed, you can share documents through a range of cloud services. If you only need to sign a couple of documents, the free version of the app will be fine. But if you need to regularly sign documents, you’ll have to upgrade to the premium version.
- CudaSign (iOS, Android) is a similar but slightly more advanced option than SignEasy. It costs from $1 per month, but there is a free trial available. Whoever uploads the document can specify the signatory. An email link is sent, and signers can then “sign from their computer, tablet or cell phone”.
Yes, E-Signatures Are Legal
Next time you click an I accept, or I agree button, bear in mind that you are signing a legal contract. And whenever you come to sign any other form of document electronically, know that your sign of intent is just as legally valid as a hand-written signature.
Over to you: Do you think all these “signs of intent” should be considered as legally valid as a handwritten signature?