What are the ESIGN and UETA Acts?
A federal law passed in 2000, the ESIGN Act gives legal recognition to electronic signatures at the national level and applies to all U.S. states and territories where federal law is in effect. When the ESIGN Act was introduced, most states had already adopted UETA state law, which still applies when it does not conflict with the ESIGN Act.
What is an electronic signature?
As defined in the ESIGN and UETA Acts, an electronic signature is “an electronic sound, symbol or process attached to or logically associated with a record and executed or adopted by a person.” Simply put, it is an electronic form of a signature that a signer applies to a document as evidence of their intent to sign.
Are electronic signatures legally valid?
Yes, both acts give clear indication of the legal validity of electronic signatures: “A record or signature may not be denied legal effect or enforceability solely because it is in electronic form.”
Within the acts, there are four major requirements for an electronic signature to be deemed legally valid:
Intent to sign
Like handwritten signatures, electronic signatures are only valid if the party intended to sign and enter into the agreement. Nitro requires signers to position their signatures on the document and explicitly confirm their intent to sign by submitting the signatures.
Consent to do business electronically
All parties to a transaction must consent to conduct the business electronically. Each party has the right to withdraw consent at any time. Nitro satisfies this requirement by requiring signers to agree to this disclosure before completing a document.
As defined in the ESIGN and UETA Acts, an electronic signature is “an electronic sound, symbol or process attached to or logically associated with a record and executed or adopted by a person.” Therefore, any system used to capture electronic signatures must be able to attribute the signature to the individual. Nitro captures and stores all actions taken by signers on a document. This audit history can be used to demonstrate the attribution of a signature to a signer.
All parties to a transaction must be able to accurately retain and reproduce a record of their electronic signatures. Nitro allows each signer to download their signed PDF document after completion of the agreement.
The information above is provided for information purposes only and is not presented, and should not be construed, as legal advice. Nitro recommends that you engage legal counsel to understand the full legal requirements that apply to your region and processes for the use of electronic signatures.