Subscribe to LexTalk to stay on top of today’s legal issue and trends.
Catapult Your Career |
Industry Insights & Trends |
Product Training & Tips
By James Nastasi
Twitter / LinkedIn
The future devours technology. With every technological upgrade, old technology usually become extinct, things like:
Some of these extinctions aren’t surprising.
But what if physical signatures became extinct?
Would that surprise you?
The Uniform Electronic Transactions Act (UETA), adopted in 47 states, governs the creation of electronic contracts. Cindy Hangartner, writing for Lexis Practice Advisor®, points out that for an electronic contract to be enforceable, it must have a valid e-signature. A valid e-signature is defined as:
a sound, symbol, or process that is attached to or logically associated with the electronic record and is made with an intent to sign the electronic record.
A “sound, symbol or process” (plus “intent”) is a fairly broad definition. Consequently, electronic signatures can take many forms:
Signatures aren’t the only things going digital. In today’s world, digitization affects pretty much everything: our information, our shopping, our social connections, our business dealings, etc. And as digitization expands, we typically experience the opposite reaction – a contraction of our old ways.
So as digital information expands, print media contracts.
As digital shopping expands, brick and mortar stores contract.
And as electronic signatures expand ... you guessed it ... handwritten signatures must contract too.
As cursive handwriting disappears, it’s arguably the same for handwritten signatures – disappearance. Writing for Slate, Josephine Wolff proclaims that “the end of the signature actually happened a while ago.“ She notes that:
very few transactions actually require physical, handwritten signatures anymore besides the sale of land and real estate. .... In fact, the physical signature seems to be an increasingly worthless tool for authenticating people’s identities as we do more and more signing with fingers, and screens, and end up bearing little resemblance to our pen-and-paper signatures.[emphasis added]
The physical signature ... a "worthless" tool?
Sounds harsh, but there's truth to it because the physical signature is significantly inferior to the electronic signature. Brooke N. Bates points out that an electronic signature is more secure than a physical signature. To drive home her point, Bates describes an electronic signature as:
a three-dimensional thumbprint. It carries layers of information about who signed what, when, where and how, creating a robust data trail that details what that e-signature really signifies.
A three-dimensional thumbprint versus a one-dimensional scribble? The more secure choice is obvious.
Though more secure, electronic signatures do have a weakness – it’s that they’re relatively new.
The UETA is a fairly new law; it's only 18 years old. This newness leaves a lot of legal gray area ... gray area not found in the more established (and more clearly defined) handwritten signature.* Consequently, courts are continually being asked to shape electronic signature law. For example, as reported by Holland & Knight, the District Court for the N.D. of Illinois was recently asked whether a username and password amounted to an electronic signature.
In Abdul Mohammed v. Uber Techs., Inc., 2017 U.S. Dist. LEXIS 20274 (N.D. Ill. Feb. 14, 2017), Mohammed, an Uber employee, provided his username and password to Uber’s Driver Services Representatives (DSR). The DSR then entered the information into Uber’s app, read the prompts and accepted an arbitration agreement without showing Mohammed the terms.
Mohammed, the plaintiff in the case, argued that he was not bound by the arbitration agreement. As reported by Holland & Knight:
Uber argued that the agreement to arbitrate was valid because Mohammed supplied the DSR with the username and password for the Uber app. Specifically, Uber argued that this username and password sufficed as an electronic signature ....
The district court ruled against Uber, holding that:
even assuming that Mohammed's username and password can serve as a valid electronic signature under the ECSA [Illinois's Electronic Commerce Security Act], the fact that Mohammed provided this information to the DSR (at the DSR's request, by the way) is not in itself sufficient to demonstrate that Mohammed had authorized the DSR to accept any and all contracts on his behalf, particularly contracts of which he had no knowledge.
Here, the court based its judgment on contract law (i.e., intent), not electronic signature law. Left unanswered, the question:
Can a person’s username and password serve as a valid electronic signature?
Thus, the gray area remains gray, which, to some small degree, favors handwritten signatures.
But certainty (vs. security) isn't the only reason to favor handwritten signatures.
Before we toss them aside, let's not forget that America owes handwritten signatures a debt of gratitude. The Declaration of Independence carries with it 56 physical signatures, and none is more memorable than John Hancock's sizable signature. Here's what Hancock supposedly said about his oversized autograph:
There, I guess King George will be able to read that without his spectacles!
If electronic signatures had existed in 1776, Hancock's celebrated point would never have been made.
* Ballentine's Law Dictionary defines “signature” as “The name of a person appended by him to an instrument. The execution of any symbol upon a writing with intent to authenticate the instrument as one made or put into effect by him.”
Need help navigating the gray areas of electronic signature law ... or other types of law. Check out Lexis Practice Advisor®, which provides practical guidance backed by experts. Get more information on Lexis Practice Adivsor, or access your free, 7-day trial.
You can connect with James via Twitter or LinkedIn. If you're interested in discussing a legal solution, like Lexis Advance® or Lexis Practice Adivsor, you can email James at firstname.lastname@example.org.