Magazine article Journal of Property Management

Sign of the Times

Magazine article Journal of Property Management

Sign of the Times

Article excerpt

When done properly, electronic signatures are binding

Electronic signatures are the latest stride in the march of technology to expedite document execution and enforceability of the deal. It was not that long ago that we used typewriters and carbon paper, and documents were not enforceable in our courts unless they contained original signatures. We now use, and courts routinely accept, copies of all types and facsimile signatures.

The Electronic Signatures in Global and National Commerce Act ("E-Sign"), enacted nearly eight years ago, was the federal response to a growing state-by-state movement to permit electronic signatures. Prior to the passage of the E-Sign law, there were variances in many state laws on the use and enforceability of electronic transactions. As a result, the Uniform Electronic Transactions Act ("UETA") was created and many states adopted it. UETA is only applicable in those states that have adopted it, but the ?-Sign law is applicable nationwide on a federal level.

The E-Sign law says:

1) A signature, contract or other record relating to such transaction may not be denied legal effect, validity or enforceability solely because it is in electronic form;

2) A contract relating to such transaction may not be denied legal effect, validity or enforceability solely because an electronic signature or electronic record was used in its formation.

Simply stated, the E-Sign law and UETA provide that, if all other components are present, a party cannot defeat the validity of a contract simply because it has an electronic signature.

Make no mistake, dealing in electronic mediums does not eliminate or change the traditional elements required to make a contract.

Establishing expectations is crucial to all parties making the real estate deal. The parties can expressly agree to the method and manner by which they will be bound under a contract (i. …

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