Dispelling the Myths of E-Signatures: Are They Legal?

Companies who are considering integrating e-signatures into their everyday business processes will quickly and easily see the benefits of them. However, one thing that stops many companies from making the decision to utilize e-signatures is wondering whether they’re truly legal and whether they work the same as actual printed and signed contracts.

Are E-Signatures Really Legal?

The most common myth about e-signatures is that they’re not actually legal, and couldn’t be upheld in a court of law. The truth is that e-signatures work just like typical contracts, and are legal and binding*. As long as companies keep records of the documents and the fact that the customer “signed” them, they can be upheld in a court of law just like regular contracts that are manually signed.

Laws Upholding E-Signatures

There are a few different laws governing e-signatures, including the ESIGN Act of 2000. This act made e-signatures just as legally binding as a traditionally-obtained signature. The law makes these signatures equal to their paper counterparts. The other law that governs e-signatures is the UETA (Uniform Electronic Transaction Act), and this law defines what an e-signature.

What is an E-Signature?

The UETA states that an e-signature is “an electronic sound, symbol, or process, attached to or logically associated with a record and executed or adopted by a person with the intent to sign the record.” Typically, e-signatures are as simple as the individual typing their name with the intent of signing an electronic document. However, it could entail something else, such as making a statement or something similar.

Great for the Customers

 Another myth that is common about e-signatures is that customers don’t trust them. This is entirely untrue. Customers have come to expect convenience, as it is something that most businesses in just about every industry place a priority on. When customers can quickly and easily accomplish something that might normally take days, they’re happier customers! By offering your customers the opportunity to electronically sign documents rather than waiting for them to come in the mail, you have an edge on your competition and can end up blowing them out of the water!

Things Companies Should Know About E-Signatures

 Companies who decided to utilize e-signatures should know that it’s very important to keep thorough records of those documents signed with e-signatures, as well as any other correspondence with customers that sign electronic documents. This is what is used if there is a dispute or conflict with the e-signature and acts as the proof in a court of law. As long as these files are kept and organized, e-signatures can be very beneficial for businesses. They save a lot of time, money, and are a great move to make with the environment in mind.

Overall, e-signatures are something all businesses should consider. It gives them a lot more freedom and allows them to offer their customers a type of convenience that many other companies simply don’t offer.

*Each case is independent and we recommend you consult with an attorney in your specific case.  We are not providing legal advice or recommendations and you should always consult with a professional.

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