The importance of this issue cannot be overemphasized. Obviously, you don`t want a company to pretend that they don`t have to abide by the contract because it was signed by someone who wasn`t authorized to do so. So, if the other party to the contract is a business, you need to make sure that the company actually exists, that the person signing on behalf of the company has the authority to do so, and that the contract has been approved by the shareholders or directors of the company. We now believe that this distinction between pre-filled signatures and signatures newly entered in emails reflects an unnecessary formality that does not reflect the way the law is common today. It is not the signature that indicates whether the parties intended to reach an agreement by email, but the fact that the email was sent. Across the country, courts are increasingly enforcing contracts formed by the exchange of emails that appear to be informal and are not signed in the traditional sense. A recent decision in New York stated that “given the now widespread use of email as a form of written communication in personal and business matters, it would be unreasonable to conclude that email messages are not able to meet the criteria (the New York version of UETA), just because they cannot be physically signed in the traditional way”[2] But wait, it`s getting worse. Email exchanges can also inadvertently modify existing contracts. This was the situation in another New York case, where the court found that the written employment contract of an underperforming executive had been altered by an email exchange between him and the president of the executive`s parent company. These emails described a proposed new role for the leader within the organization. The executive “accepts (the) proposal with total enthusiasm and excitement.” [3] Given that e-mail is now the primary means of personal and professional communication worldwide, it is important that the parties are aware of the possible legal consequences of such communication. While parties may treat emails in the same way as oral conversations, a fundamental question is whether the legal system views these communications as mere informal or legally binding conversations.
Is an email legally binding? This is a question that affects many of those who often deal with contracts or imagine that they will soon be, and the answer to this question is yes, emails are generally considered legally binding by the courts.3 min Read The following steps should be followed when signing a contract: I have always been a great advocate of making sure that the terms of a contract are as clear as possible to express the intention of their parties. It is just as important, if not more so, to ensure that a binding contract is not inadvertently created by what one or more of the parties involved consider and intend to be an informal exchange of emails. Today, pixels reign. Email, instant messaging, and other electronic communications (collectively, for this article, “email”) have revolutionized the way we all communicate and correspond. They made it lightning fast and much more informal than paper correspondence like traditional letters and faxes. But like most innovations, these means of electronic correspondence have created new problems. The main one of them is the involuntary and unwanted contract. Sending contracts for online electronic signature eliminates the costs and effort associated with printing, scanning, faxing and overnight delivery. Since the validity of email contracts is generally recognized by law, it is important to exercise caution when doing business via email.
To this end, the following tips may be helpful: By using the paid version of DocuSign eSignature for signing contracts online, you can: This case means that tapping “Send” in an email now potentially equates to signing a piece of paper containing the statements contained in the email. A truly typed signature is not required. The Federal Electronic Signatures in Global and National Commerce Act, which applies to all interstate and foreign transactions, and the Uniform Electronic Transactions Act (“UETA”), the version adopted by California[1] and the majority of states, provide that a contract and signature will not be deprived of legal effect simply because they are in electronic form. According to these laws, the sender`s printed name at the end of an email, in the signature block of the email, or even in the “From” line may be a sufficient electronic signature to bind the sender to a contract entered into through that email exchange. Most people think of contracts as formal agreements that are written and signed by the parties involved, often in the presence of lawyers, but the fact is that a contract is just an agreement between several parties on an exchange of valuables and the physical form of the contract is not so important. However, not all courts agree that a party intends to be bound by the terms of a contract by inserting their name at the end of an email or by having an automatic signature lock. The Fort Worth Court of Appeal ruled that the auto-signature block did not constitute a signature because there was nothing in the email to indicate that the party intended the auto-signature block to be a binding signature in this case. The court distinguished between the physical entry of a signature line and an automatically generated signature block.
Other courts disagreed, noting that there was no difference between entering a signature block in emails and typing the block once and asking a computer program to attach it to future messages. .