The Legal Validity of E-Signatures: Understanding the Basics

document management

The internet has revolutionized how we do things in our daily lives, and one of the most significant changes has been the digitization of various aspects of our lives. From online banking to shopping, the digital age has transformed how we do things. 

One area that has also undergone digital transformation is the traditional inked signature, which has been replaced with electronic signature software or e-signatures.

But what exactly is an e-signature, and how does it work? More importantly, can e-signatures be legally binding? In this article, we will explore these questions and more.

What Are E-Signatures and How Do They Work?

E-signatures are digital equivalents of inked signatures unique to an individual and used to confirm their agreement to a document. Unlike inked signatures, e-signatures are multi-dimensional and can be signed in various ways, including using electronic contract signing software.

However, an e-signature on a document does not guarantee its legal validity. Specific criteria must be met for a document containing an e-signature to be considered legally binding.

Establishing Legal Validity for E-Signatures

In most third-world countries, the United States, and the United Kingdom, e-signatures are legally binding. However, several criteria must be met to establish the legal validity of an e-signature.

The Signatory’s Personal Information

Verifying the signatory’s identity is crucial in determining the legal validity of an e-signature. Several methods can be used to verify the signatory’s identity, including electronic identification cards, SMS, or email.

The Content and Intent of the Document

The content and intent of the document are also critical factors in determining the legal validity of an e-signature. The purpose of the signatory in signing the document must be unambiguous. The document must become legally binding only after all parties involved have signed and the final signatory has provided an electronic signature indicating an agreement to the document’s content.

The Integrity of the Electronic Signature

The integrity of a signing software is essential in establishing its legal validity. To ensure this, the document must be retained in its original form, without any modifications, after all, parties involved have signed it. A document signed using Public critical infrastructure (PKI) must be hashed and signed with an asymmetric encryption key pair to be valid. Even a minor alteration can result in a different hash value, making it easy to detect any changes to the document.

In Conclusion

While e-signatures are becoming more prevalent, their legal validity remains contentious. To establish the legal electronic signature, the signatory’s identity must be verified, the document’s content and intent must be clear, and the e-signature’s integrity must be preserved. All elements must be added to make the document legally unenforceable.

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