Defining eSignature and what it actually means

In today’s blog, we’ll be defining eSignature and what it actually means. Since the ESIGN law of 2000 passed, electronic signature in the United States has been formally defined as…

“an electronic sound, symbol or process that is attached to or logically associated with a record and executed or adopted by a person with the intent to sign the record.”

Yet, now, more than 18 years later, we still find many people who don’t know what this really means.

Even an “I agree” box–accepting the software end user license agreement–OR the “Place your order” button–agreeing to Amazon’s conditions of use–is a legally binding form of electronic signature.

Who knew?

Is it commonplace to execute electronic signatures for documents or agreements by simply checking a box? The check box itself does meet the “symbol” requirement of ESIGN, but the answer is more complicated…

Of the three items that define an electronic signature, electronic sound, symbol or process, the most important interpretation is the process.

The case of Zakuski v. General American does a superb job of outlining the validity of electronic signatures in accordance with its process:

In 2012, the case was heard before the Michigan Supreme Court. It involved the mother and second wife of a recently deceased doctor. Upon marrying his second wife, Dr. Z changed his life insurance beneficiary from his mother to his newly beloved.

This electronic process required the entry of many personally identifying attributes, such as the doctor’s social security number, mother’s maiden name, policy number, etc. Further, an email was sent to his email notifying him of the change.

Because of this process, the court found it significantly unlikely that someone would have:

  1. known the doctor’s life insurance policy supplier;
  2. been made aware of the ability to change a beneficiary using the supplier’s e-service;
  3. access to the personally identifying attributes necessary to authorize the change; and
  4. changed the beneficiary.

Further, no complaint or action ensued following the email alert. Because of this and the mother’s lack of evidence proving otherwise, the court upheld the change of beneficiary authorized by the doctor via his electronic signature. The case was again upheld by an appeals court.

The validity resides in the process

By showing the process that was used to identify the doctor (attribution) and the steps required to change and authorize a beneficiary, General American’s claim that the electronic signature was non-fraudulent was upheld.

Thanks to the ESIGN and UETA act coupled with the unequivocal support of lower and higher courts, electronic signature is becoming widely accepted among today’s businesses and consumers.

 

 

Want to try out Nintex AssureSign® for yourself? Click here to request a free trial.

 

 

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