July 21, 2011
Ever wondered if it’s legally binding to sign your business documents online?
A brief history first. Early Roman law recognised the amalgamation of seals and signatures as a principal for the authentication and legality of documents. Centuries later (mid-nineteenth century), the Morse Code and telegraph were recognised as the first legal ‘electronic’ signatures. The following century (1976) saw Whitfield Diffie and Martin E. Hellman lead the way to implement the legal equivalent to a written signature using cryptographic method; and then in 1996, the United Nations Commission on International Trade Law published the UNCITRAL Model Law on Electronic Commerce with Guide to Enactment that influenced the development of electronic signature laws internationally.
Since that time, around the world, different laws have been passed that guarantee the legal authority and enforcement of electronic signatures: Uniform Electronic Transactions Acts (UETA), Electronic Signatures In Global and National Commerce Act (ESIGN), FDA 21CFR Part 11, EU Directive for Electronic Signatures, Electronic Transactions Acts in different countries, and many others.
The legal specification for a signature is fulfilled by means of an electronic signature if the signature:
- Appropriately identifies the signatory
- Appropriately indicates the signatory’s authorisation of the information to which the signature relates; and (Intent)
- Is as reliable as is appropriate given the occurrence
An electronic signature is adequately reliable if the means of creating the signature is connected to the person who signs the document, is under their control and no one else’s, and if the system can detect any changes made to the document and signature.
It is imperative to highlight that although the term used in all acts is ‘electronic signature’, the ‘digital signature’ is a sub group within electronic signatures that uses Public Key Infrastructure (PKI) — the only technology that ensures non-forgeable signatures. Secured Signing’s user-based PKI digital signature application provides the highest form of digital signature, and content that guarantees signer authenticity, data integrity, and non-repudiation of signed documents and transactions. If the document is altered, signatures immediately become invalid.
“We are confident that the systems used by Secured Signing ensure that the electronic signatures produced meet the legal requirements for a signature. In fact, the security and logging facility, in our view, provides better authenticity than many of the methods by which documents are now commonly signed and exchanged (e.g. e-mail and facsimile). So, unless there are specific laws dictating that a document can only be signed in a particular way (as far as we are aware, the only common law which does this relates to wills), any form of contract can be signed using the Secured Signing System.” Rick Shera / Angela Beros , Partner / Solicitor, LOWNDES JORDAN, Barristers & Solicitors
Till next time,
Cheers, John