The use of electronic signatures for a wide variety of legal documents has been a key component of the internet age, providing corporations and clients alike with a streamlined process for signing documents. However, while electronic signatures have become the predominant choice for most, there are still many questions that surround them. Namely among these concerns is whether or not they are legal in binding contracts.
Are Electronic Signatures Legally Binding?
Yes, an electronic signature is just as valid for a binding contract as a handwritten signature. The passage of the Electronic Signatures in Global and National Commerce (ESIGN) Act by the US government in 2000 was a high-water mark for the digital age and electronic signatures in particular. The ESIGN Act established a nationwide network that ensured all electronic contracts for interstate and global commerce would be legal. It offered a protective system for large corporations, small businesses, and individuals alike, ensuring them that any documents submitted with an electronic signature would be considered valid and legal in the eyes of the law.
Are Electronically Signed Documents Admissible in Court?
As a result of the ESIGN Act, a document that has an electronic signature is valid in any court case. However, simply having an electronically signed document may not be enough. Given the propensity of forged documents, a judge may request or require evidence that an electronic signature is legitimate. To do so, a judge will review the documents and ensure they meet the criteria outlined in Title 21 CFR Part 11. Part 11, as it is commonly known, is a metric used to validate the authenticity of any electronic record or electronic signature. Through the use of audit logs, biometric authentication, and IP addresses, the authenticity of an electronic signature may be established.