As more and more documents migrate into digital areas, the world is becoming an increasingly “paperless” place. People who were born in this decade may not be familiar with phrases such as “sign on the dotted line” or “before the ink is dry” unless their grandparents have explained it to them. However, given the lack of physical copies of essential papers, our judicial system need new methods to demonstrate that a party has consented to the terms of a contract. Now, evidence of assent can be provided by electronic signatures, often known as “digital signatures” or “e-signatures,” which eliminate the need for a pen and a printer. Electronic Signatures in Global and National Commerce (E-SIGN Act) is one example of a law that had passed at the federal and state level to establish standards for demonstrating the authenticity of electronic signatures. When it comes to the purchase and sale of real estate, the use of electronic signatures for real estate has permitted in any circumstance in which the law does not expressly demand otherwise.
What Exactly is Meant by the Term “Electronic Signature”?
An electronic signature is defined under the E-SIGN Act as any “electronic sound, symbol, or procedure” that satisfies the following criteria:
- It is “connected to or logically associated with” a document (for example, a contract); and 2. The person who “executes or adopts” it has the intention of doing so.
Hardware, such as the signature pads seen at many retail checkout counters, and software, such as the signature functionality included in products like Adobe Acrobat or services like DocuSign, are both able to make it feasible to create and use electronic signatures. In order for the signature to be valid, it must conform to the criteria established by either federal or state legislation, and an electronic signature must also be permitted for use on that particular document.
The E-SIGN Act as well as the UETA
The Uniform Electronic Transactions Act was enacted in the state of California in 1999. (UETA). In the year after that, Congress passed a law called the E-SIGN Act. In California, the use of electronic signatures is regulated by the UETA, which applies to the vast majority of real estate transactions. Transactions that take place across state lines are subject to the E-SIGN Act. Both of these laws share a lot of ground with one another. For instance, the definition of “electronic signature” that can be found in federal legislation is very similar to the one that can be found in the UETA.
The very first section of the E-SIGN Act states that a signature cannot “be denied legal effect, validity, or enforceability” solely on the basis of the fact that it is electronic, provided that no other law requires a physical signature. This provision applies only if there is no other law that requires a physical signature. The statute does not take precedence over the other statutes in question. If a law requires a person or company to keep records, then the E-SIGN Act enables them to comply with this duty by maintaining correct electronic records that are accessible to anybody who has legally authorized to review them. This applies to both individuals and businesses.
Electronic signatures has permitted on papers that has required to be notarized thanks to the E-SIGN Act and UETA. In addition to physically signing the document, a public notary has required to do it digitally. They must include all of the same information that they would give if they were notarizing a paper document.
Electronic Signatures on Real Estate Documents
In certain kinds of real estate papers, such as a contract between a real estate broker and a customer, it is usual practice to use an electronic signature like DocuSign and its DocuSign competitors instead of a handwritten one. There is a possibility that a physical signature is still require for any documents. It has required to be entered into the public record. For example, the Los Angeles County Recorder is the official who is in charge of recording deeds and other documents related to real property, and it appears that the Recorder will only accept filings in the physical form. In light of this, the statute of the state of California permits county recorders to accept “digitized photographs, digital images, or both, of a recordable instrument.”