Are Electronic Documents and Signatures Legal?
THE E-SIGN ACT
On June 30, 2000, Congress enacted the E-SIGN Act, 15 U.S.C. § 7001, et seq. The purpose of the E-SIGN Act is to protect transactions from legal challenges that are solely based on the electronic form of the agreement. 15 U.S.C. § 7001 (a). In other words, the E-SIGN Act ensures that electronic agreements are treated the same as paper agreements. The E-SIGN Act contains numerous provisions to further this purpose. Many of these provisions are directed to the preservation of consumer protection rights and laws, and will not be discussed here because they do not relate to entering into electronic contracts.
The E-SIGN Act explicitly confirms and preserves certain rights and obligations of the parties to an agreement. For example, the E-SIGN Act states that the use or acceptance of electronic signatures is not mandatory. 15 U.S.C. § 7001 (b)(2). Indeed, federal courts have confirmed that a company that does not regularly accept electronic signatures cannot be required by another party to accept an electronically-signed document. See, e.g., Prudential Insurance Company of America v. Prusky, 413 F.Supp.2d 48 (E.D. Penn. 2005) (holding that plaintiff’s requirement to receive by hand-written transfer requests, and its refusal to accept transfer requests by facsimile, did not violate the E-SIGN Act). As a result, electronic signatures and contracts will only be valid if all parties first consent to the use of the electronic signatures and contracts. Furthermore, to ensure that electronic documents are treated the same as paper documents, the E-SIGN Act explicitly requires that the contract or other record related to the transaction must be able to be stored and accurately reproduced for later reference. 15 U.S.C. § 7001 (e). Moreover, the E-SIGN Act explicitly states that it does not limit, alter, or otherwise affect any statute, or any requirement of any statute, other than a statute that explicitly requires a non-electronic signature. 15 U.S.C. § 7001 (b)(1).
As an example of the interplay between an existing statute and the E-SIGN Act, suppose that an existing statute requires that an original of a contract must be retained, provided, or made available. The E-SIGN Act provides that the hypothetical statute’s requirement that an original be retained is met by retaining an electronic record of the information in the contract or other record, so long as the electronic record accurately reflects the information set forth in the contract or record. Additionally, the electronic record must remain accessible to anyone who is entitled to access the record. The electronic record must be available for the period of time required by the hypothetical statute, and, as stated above, it must be electronically stored in a form that is capable of being accurately reproduced for later reference. 15 U.S.C. § 7001 (d). Further to this point, with respect to checks or other bank notes, the E-SIGN Act provides that, if a statute requires the retention of a check, that requirement is satisfied by retention of an electronic record of the information on the front and on the back of the check in accordance with the above criteria.
Finally, the E-SIGN Act provides that certain contracts or records are exempted from its provisions. For example, the E-SIGN Act does not apply to, among other documents or records, the following documents: (i) any contract or other record that is governed by a state’s statute governing the creation and execution of wills, codicils or testamentary trusts; (ii) any contract or other record that is governed by the UCC, as in effect in any state, other than sections 1-107 (Waiver of Right after Breach) and 1-206 (General Statute of Frauds) and Articles 2 (Sales) and 2A (Leases); (iii) court orders or notices, or official court documents required to be executed in connection with court proceedings; (iv) default, acceleration, repossession, foreclosure or eviction of an individual from a primary residence; and (v) the cancellation or termination of health insurance or benefits or life insurance benefits (excluding annuities). 15 U.S.C. § 7003.
Is This Secure? How Do You Prevent Fraud?
To satisfy and exceed all federal and state requirements pertaining to digital signatures, YouSignHere implements an electronic contracting system with the following features:
- • Final, negotiated contracts are posted online in a secure environment in pdf form for final review and signature by both parties;
- • The customers and signatories are sent email links to the agreement on the secure site;
- • The contract is locked to prevent any edits, and is served in a form that allows saving and printing by the customer – e.g. a customer is able to click a download/print button prior to and after executing the agreement;
- • YouSignHere SSL-secured site provides a digital signature mechanism using strongest commercially available 2048-bit private key/public key scheme;
- • Upon execution by both parties, an electronic record of the agreement is automatically created, which includes the electronically executed signatures and the agreement itself, and such record preserves the integrity of the agreement and signatures (i.e. no changes can be made to the record without detection);
- • The customer receives a copy of the digital record, e.g. via email (with a record that such email was sent);
- • The system provides date and time stamps for each step of the above process, as part of the record (see sample below);
- • YouSignHere keeps a record of each digitally signed contract that accurately reflects the content of each contract, with the ability to accurately reproduce the record and provide a copy of the record to the customer if requested at a later date;
- • YouSignHere provides a means for detecting transmission errors or changes and provides for either party to notify the other party in the event it detects an error or unauthorized change in the electronic record of a transaction.
So, Will My Data Be Safe And Accessible?
We make use of the most powerful commercially-available methods to ensure this. Your data is not only safe and accessible, but it is also stored in a way which protects from hardware failure and facility disasters too. Your documents are probably safer with us than they are in paper form in your company's storage room.
Does YouSignHere Allow Mobile Document Signing? If So, Which Browsers Are Supported?
Yes! We went to great lengths to keep the experience flexible and consistent, retaining all features and conveniences, across most all modern platforms. Whether iOS, Android, Windows, or other devices which support recent generations of web browsers, your device is very likely to support all features of sending documents and signing them. However, we do recommend using a desktop for document creation for maximum convenience.
Even better! We don't even charge you. Use our software completely FREE for 30 days and decide if it is right for you. After that, your monthly investment will likely be less than your current paper budget alone on the documents you are no longer printing, but you'll also eliminate toner costs, envelopes, postage costs, mail waiting times, and the real expense of the whole process - data entry and human error.
Yes! We want YSH to be useful to you and for you to be happy with it. If at any time you feel you aren't getting enough and need more, please let us know, we might be able to deliver. And if you are simply not going to need YSH anymore, cancellation is painless and does not require any significant actions or explanations. You can cancel whenever you wish.
No. Whether on desktop or mobile device, there are no apps or plugins to download/install/configure to make YSH function. YouSignHere is a web-based cloud-hosted system, meaning that all modern browsers will have access to YSH from virtually any desktop and mobile device.
While we cannot guarantee that your customers will answer honestly, YouSignHere has smart fields, which prevent incomplete or incompatible answers to be submitted, making your process that much more accurate, efficient, and error-proof.
What If I Need My Documents Signed By More Than One Person?
YouSignHere documents can be signed by a virtually unlimited number of people. All you have to do is decide whether they need to do it simultaneously (e.g. spouses co-signing), or as a part of approval workflow (e.g. escalation to the manager for approval). All appropriate emails will be sent as needed throughout the workflow process and you will be notified when all required signatures have been collected.
What If I Need More Than One Document Signed At Once?
It is often the case when multiple forms and ammendments have to be filled out and returned along with the main contract. Staffing hiring onboarding packages and auto & home purchases with financing documents can get rather lengthy too. YouSignHere provides an option to join multiple documents into a single package, requiring all documents to be reviewed, filled out with custom fields, or signed.
How Do I Get The Data In The Documents Into My Systems?
This is the most valuable aspect of YSH. The system can integrate with your systems and systems of your partners and clients. You have two options to choose from: integrate yourself, using our API; or let us know what you need and we will create a custom integration or even custome features to accomodate your needs.
Yes. We do have a way for you to partner with us, and you should contact us for more details and to get started, if we meet each other's criteria.
Is There An Option To Whitelabel Your Software?
Yes. YSH can be whitelabeled, completely removing any sign of our brand, making it look liks YSH is your product..