August 2005
Volume 1, Number 4
Table of Contents

Think Before You “Click”
By Lloyd D. Cohen, Attorney at Law

The riddle for modern times goes like this: When is your signature not your signature?

When is something in writing never written? The answer is simple but the impact is enormous.

Since the Middle Ages, people have memorialized their important legal choices with the ceremony of laying ink on paper and briefly waiting for it to dry. The ritual not only emphasized the importance of the action being undertaken, but also its finality. Recall the nervousness and hesitation associated with putting pen to paper when the realtor slides the purchase contract across the table, or the banker hands over the loan papers, or your lawyer gives you a draft of your Will.

In modern times, the signing ceremony may be replaced by the mere “click” of a computer key. A legally binding contract may only exist as electronic fields and templates associated by a database program stored in the memory of a computer. A digital or electronic signature binding you to the contract may be symbolized by something other then your name and might not exist on any paper anywhere.

The Ohio Uniform Electronic Transactions Act (UETA) says that an electronic signature may be attached to or logically associated with an electronic record. UETA provides as follows:

  • Information, records, and signatures shall not be denied legal effect, validity, or enforceability solely on the grounds that they are in electronic form.
  • Where a rule of law requires information to be “written” or “in writing,” or provides for certain consequences if it is not, an electronic record satisfies that rule of law.
  • Where a rule of law requires a signature, or provides for certain consequences if a document is not signed, an electronic signature satisfies that rule of law.

Since World War II, businesses in need of product have enjoyed the ease of being able to mail a “purchase order” to a supplier. Such orders, received in the normal stream of commerce, causes shipment of the requested product. The product later arrives at the business with an “order invoice” requesting payment of the amount due. This practice makes business more efficient by eliminating the need for buyer and seller to enter into a separate contract each time a purchase is desired. E-commerce laws now permit businesses to make purchases simply through the use of e-mail.

In tandem, the Electronic Signatures in Global and National Commerce Act (ESIGN) provides that, in the United States, the use of a digital signature is as legally valid as a traditional signature written in ink on paper. The law also contains some consumer protections. Information required by law to be in writing can be made available electronically to a consumer only if the individual affirmatively consents to receive the information electronically and if the business clearly and conspicuously discloses specified information to the consumer before obtaining the individual’s consent. A consumer’s consent to receive electronic records is valid only if the consumer confirms his or her consent electronically. This electronic consent must be obtained in a manner that reasonably demonstrates that the consumer can access information in the electronic form that will be used to provide the information that is the subject of the consent.

Under these laws, your consent and your signature may be represented by something other then your signed name. Some software makers talk about your digital signature.

However, this may refer to a cryptographically encoded document that alerts the reader to any alteration, or the reference may be to an attachment of an image that looks like your own signature. However, your e-signature may have nothing at all to do with an image of your name. The law provides that your e-signature can consist of almost anything. For example, a voice print, retinal scan, or passcode can be considered to be your signature. Your consent to a contract can be given as easily as just filling in a “dot” in an on-screen box, or the mere “clicking” of the “y” on your keyboard.

According to a Federal Trade Commission study on this subject, a clue that you are dealing with an honest online party is that their disclosures are timely and clearly and conspicuously made, with ample opportunity for downloading and printing. A clue that you are dealing with unscrupulous operator is the presence of confusing or unprintable material. Either way,think before you “click.” Although a “keyboard click” is more casual than the physical action of taking a pen across a printed page, it can have the same legal significance.

Lloyd D. Cohen comments on life, law, economics and politics. He is engaged in the private practice of Law, concentrated in the solving of financial problems including: Bankruptcy, Business, Tax, Estate Planning, and the problems caused by predatory lending.

 

 

 

 

 

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