Electronic Signatures and Electronic Documents
COVID-19 has resulted in some drastic changes to nearly every aspect of our lives. Social interactions have been drastically limited, and many people are for the time being working from home. But the work continues! One way businesses may opt to adapt their practices is by accepting electronic copies of original (hand) signed documents and/or by permitting the use of electronic signatures for executing documents that require signatures.
The Electronic Commerce Act
The legal basis for accepting electronic signatures or electronic copies of documents in lieu of requiring an original document is contained in the Electronic Commerce Act, 2000 (the Act). Section 8 of the Act deals with the legal requirement of original documents and states that a potential legal requirement that an original document be provided, retained or examined is satisfied by the provision, retention or examination of an electronic document if:
- There exists a reliable assurance regarding the integrity of the information contained in the electronic document in its final form; and
- Where the document is provided to a person, the electronic document provided is accessible and usable for reference by that person.
Regarding electronic signatures, Section 11 of the Act outlines that the legal requirement that a document be signed is satisfied by an electronic signature if it meets certain reliability requirements. Most importantly, the electronic signature must be reliable for the purpose of identifying the person that signed it, and the association of the electronic signature with the relevant electronic document must also be reliable.
It is important to note that the requirements listed above are not a complete list and there are exceptions to these general rules. For instance, there are certain documents to which the Act does not apply and which therefore cannot be signed electronically, nor will an electronic version satisfy the requirement that an original signed document be provided. Wills, Codicils, Trusts created by Wills or Codicils, Powers of Attorney and Negotiable Instruments all are documents that are not captured by the Act. There are also a number of other restrictions that apply related to privacy, record destruction, documents of title etc.
Despite these exceptions, there are a greater number of documents that are captured by the Act and therefore can be signed electronically or stored electronically as an original document. The point is, different documents may have different requirements under the Act. There are certainly ways in which contracts can be drafted to properly incorporate the relevant provisions of the Electronic Commerce Act, and if this is something you are considering, we would be more than happy to assist you in this regard.