Are electronic signatures legal?

In short, yes, electronic signatures are legally biding in the US under the ESIGN Act. 

If you’ve ever signed a contract or document online, you’ve probably used an electronic signature to do so. These digital signatures are often seen as an easy, convenient way to finalize agreements without the need for paper and pens. But with so many people using them, you may be wondering: Are electronic signatures legally binding?

The answer is reassuring. In most cases, yes, electronic signatures are legally binding. However, it’s important to understand how they work, under what conditions they hold up in court, and what tools you need to ensure their validity. 

In this post, we’ll break down everything you need to know about electronic signatures, including when they’re legally accepted, how they compare to traditional signatures, and the best practices to ensure that your digital signature is recognized as legally valid.

Are electronic signatures legally valid in court?

If you’re considering using an electronic signature for a contract or other important document, you’re likely wondering whether it will hold up in court if needed. Again, the short answer is yes, electronic signatures are legally valid and enforceable in court. But certain conditions need to be met.

The Electronic Signatures in Global and National Commerce Act (ESIGN Act), passed in 2000, made electronic signatures legally recognized in the United States. This law states that electronic signatures are as valid and legally binding as traditional handwritten signatures. 

However, there are specific criteria that need to be satisfied for an electronic signature to be considered legally binding. These include 

1. intent to sign, 
2. consent of the parties involved, 
3. ability to verify the signer, and
4. store the documents securely. 

How to ensure the validity of your electronic signature

To maximize the legal enforceability of electronic signatures, follow these best practices:

1. Use a trusted eSignature platform

Choose a reliable platform that complies with the ESIGN Act and UETA (Uniform Electronic Transactions Act). These platforms are specifically designed to meet legal standards for electronic signatures, ensuring they are recognized as valid in court. Look for features like built-in authentication, audit trails, and tamper-proof technology.

How to do it: Research eSignature tools like Signeasy, Docusign, or Adobe Sign. Verify that the platform adheres to compliance standards and offers security certifications like GDPR or SOC 2.

2. Implement strong authentication methods

Identity verification is key to proving that the signature belongs to the correct person. Use methods like email verification, where the document is sent to a specific email address, or multi-factor authentication (MFA), which requires additional confirmation like a one-time password or biometric data.

How to do it: Enable authentication options offered by your eSignature platform, such as requiring a PIN, SMS code, or fingerprint during the signing process.

3. Include a clear consent clause

Legally binding electronic signatures require that all parties agree to transact electronically. A consent clause outlines this agreement upfront, typically at the beginning of the document or signing process.

How to do it: Add language like “By signing below, I consent to use electronic records and signatures” in your contracts or forms.

4. Maintain detailed audit trails

An audit trail provides a record of key activities during the signing process, such as the time and date of signing, IP address, and any changes made to the document. This serves as evidence if the signature’s validity is ever questioned.

How to do it: Use a platform that automatically generates an audit trail and provides a downloadable certificate of completion once the document is signed.

5. Store signed documents securely

Signed documents must remain tamper-proof and accessible over time. Storing them in a secure environment, such as a cloud-based repository with encryption, ensures they retain their integrity and can be retrieved if needed for legal purposes.

How to do it: Use secure storage options provided by your eSignature platform or upload the documents to an encrypted cloud storage service like Google Drive or OneDrive.

Are electronic signatures valid in all states?

In the United States, electronic signatures are legally binding in all states, thanks to the ESIGN Act (Electronic Signatures in Global and National Commerce Act). This federal law ensures that electronic signatures have the same legal standing as handwritten ones, as long as the criteria mentioned above are met.

However, certain states may have specific regulations for electronic signatures, especially in highly regulated sectors like healthcare, finance, or real estate. It’s important to check your local laws and regulations to ensure compliance.

In the European Union, the eIDAS Regulation ensures that electronic signatures are recognized across all member states, providing a unified legal framework for eSignature validity.

Can electronic signatures be tampered with?

Electronic signatures are designed to be secure, but like any digital process, they can be vulnerable to tampering if not properly protected. To minimize this risk, reputable eSignature platforms use encryption and secure audit trails to ensure the integrity of the document and the signature. These measures make it nearly impossible to alter a signed document without detection.

For additional security, advanced features like tamper-proof seals and digital certificates can provide an extra layer of protection. By using a trusted eSignature solution that adheres to legal standards like ESIGN and UETA, you can ensure your electronic signatures remain secure and valid.

What types of documents CAN be signed electronically?

Electronic signatures are legally valid for most types of documents, including:

• Contracts and agreements: Employment contracts, sales agreements, and NDAs.
• Real estate documents: Lease agreements, purchase agreements, and rental contracts.
• Financial documents: Loan agreements, invoices, and purchase orders.
• Government forms: Tax forms, permits, and applications.
• Everyday business documents: HR forms, onboarding documents, and approval forms.

Essentially, any document where electronic signatures comply with legal standards can be signed electronically, making it a convenient solution for various industries.

What types of documents CANNOT be signed electronically?

While electronic signatures are widely accepted, some document types require physical signatures due to specific legal or regulatory requirements, including:

• Wills and trusts: These often require handwritten signatures in many jurisdictions.
• Court documents: Certain legal filings or court orders may require wet ink signatures.
• Marriage or divorce documents: Marriage licenses and divorce agreements often demand in-person signing.
• Notarized documents: In some cases, notarization still requires physical presence and handwritten signatures.
• Certain real estate transactions: Depending on local laws, documents like property deeds may need wet ink signatures.

It’s important to check the specific legal requirements in your jurisdiction to determine if electronic signatures are permissible for a particular type of document.

The right tools to keep electronic signatures legally binding: Signeasy

Signeasy is a trusted electronic signature solution designed to help individuals and businesses sign documents quickly, securely, and in compliance with legal standards like the ESIGN Act and UETA in the United States. Signeasy ensures your electronic signatures are legally valid and enforceable in court.

Why Signeasy?

• Compliance with legal standards: Signeasy meets global eSignature regulations, ensuring your signatures are recognized in most jurisdictions.
• Secure and tamper-proof: Signeasy uses encryption and generates detailed audit trails, so your signed documents remain secure and tamper-proof.
• Easy authentication: Verify signer identities with features like email verification, access codes, and secure links.
• Multi-device access: Sign documents anytime, anywhere, using your mobile device, tablet, or computer.
• Cloud storage integration: Seamlessly store and manage signed documents with integrations like Google Drive, OneDrive, and SharePoint.

Conclusion

The short answer to "Are electronic signatures legally binding?" is a big yes! 

With the right processes, tools, and security measures in place, electronic signatures hold up in court and are legally recognized in many parts of the world. Just make sure you follow the required criteria for authenticity, consent, and security, and you’ll have the peace of mind of knowing your electronic signatures are as legally binding as their traditional counterparts.

Whether you're using eSignatures for business contracts, legal agreements, or personal documents, tools like Signeasy offer secure solutions that ensure the integrity of critical contracts while streamlining your processes.

With Signeasy, signing legally binding documents is fast, intuitive, and compliant with the highest security standards. Whether you're managing contracts or getting approvals, Signeasy ensures a smooth and reliable eSignature experience.