Digital Signature’s legality – Is a digital signature legally binding?

Today, most countries welcome the use of electronic signatures as a way to move beyond a paper-based environment. New Zealand, Australia (all states), the United States, Canada, South Africa, the United Kingdom, the European Union, and many others have established laws regarding the signing of documents in electronic format.

While people use various ways to sign electronically, ONLY Digital Signature technology that uses industry-based standards of cryptography can satisfy these laws. The Secured Signing digital signatures online service complies with and exceeds these requirements!

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We are confident that the systems used by Secured Signing ensure that the electronic signatures produced meet the New Zealand legal requirements for a signature. In fact, the security and logging facility, in our view, provides better authenticity than many of the methods by which documents are now commonly signed and exchanged (e.g. email and facsimile). So, unless there are specific laws dictating that a document can only be signed in a particular way, any form of contract can be signed using the Secured Signing System. Rick Shera, Partner, LOWNDES JORDAN, Barristers & Solicitors, Auckland, New Zealand

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Law requirements

Legal requirement for a signature is met by means of an electronic signature if the signature:

• Adequately indentifies the signatory;
• Adequately indicates the signatory’s approval of the information to which the signature relates; and (Intent)
• Is as reliable as is appropriate given the circumstances.

An electronic signature is sufficiently reliable if:

• the means of creating the signature is linked to the person signing and no-one else, and
• the means of creating the signature was under the control of the person signing and no-one else, and
• any changes to the signature are detectable, and
• any changes to the documents are detectable (data integrity ).

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Our compliance

How Secured Signing’s trusted Digital Signatures Service meets Electronic Signatures Laws

Documents that are digitally signed with Secured Signing meet the above law requirements as follows:

1. Identifying the Signatory

Only Secured Signing creates a unique digital certificate to a user, an Invitee, and a Witness. When these signatories register, additional information is added to their signature including a unique e-mail address with proof of ownership, full name, company’s legal name, full physical address, password, and more. Some of these details ensure the signatory is identified at the moment the digital signature is created. By digitally signing, users can easily verify the identity of the signatory via the digital certificate incorporated with the digital signature. Signature verification can be done online using Secured Signing’s Free Verification Service and/or on the verifier desktop.

2. Signature is linked to the signatory

The Secured Signing digital signature technology ensures that every signature is uniquely linked to the signatory and to the document by using the signatory’s Private Key. The service creates a unique digital certificate for the signatory using a Cryptographic Key that eliminates the possibility to create and/or duplicate the same signature.

3. Creating the signature is under sole control of the signatory

Secured Signing sends documents for signing only to the person whose signature is required; no one else will receive them. In order to sign, the signatory has to provide credentials verifying their right to sign: a proof of ownership of a unique e-mail address and a password to login.

4. Detecting Changes to the Document and to the Signatures (Data Integrity)

Secured Signing’s trusted digital signature service is based on PKI technology that is considered to be the ONLY technology that ensures non-forgeable signatures. Signed documents are sealed with the signatory’s trusted PKI digital signature key; the system is also able to detect any changes that might be made to the content of the document after it is first signed. If the document is modified, signatures will immediately become invalid. The indication that changes have been made will appear when opening the documents in electronic format; it will also appear at the verifier desktop.

Secured Signing solution provides additional unique features to support a valid Digital Signature:

• Strong SSL encryption for documents sent
• e-mail validation to prove ownership
• Signature’s Date and signatory’s local Time Stamp
• Signature’s purpose (Intent)
• Secure log-in and activities report
• Secured access
• Secured document storage
• Full signing process audit log
• Document log

Digital signatures that use Personalised X509 PKI Digital Signature technology sustain signer authenticity, accountability, data integrity and non-repudiation of documents and transactions.

In 1999, the EU passed the “EU Directive for Electronic Signatures” and on June 30, 2000, President Clinton signed into law the Electronic Signatures in Global and National Commerce Act (“ESIGN”), which made signed electronic contracts and documents as legally binding as a paper-based contract.

In recent years, most countries worldwide have adopted legislation and regulations that recognise the legality of a digital signature and deem it to be a binding signature. Many of them have an Electronic Transactions Act in place.

These legislations create a uniform standard for all electronic transactions and encourage the use of electronic signatures, giving electronic signatures the same legal effect as pen-and-paper signatures.

“Signing documents online with Secured Signing is the online equivalent of the signatories being in the same room together” Rick Shera, Partner, LOWNDES JORDAN Barristers & Solicitors

Secured signing service complies with ESIGN, UETA, Electronic Transactions Acts and many more.

Some Legislation worldwide:

• Australian Capital Territory -ELECTRONIC TRANSACTIONS ACT 2001
• Australia, New SouthWales (NSW) – ELECTRONIC TRANSACTIONS ACT 2000
• Australia, Northern Territory (NT) – ELECTRONIC TRANSACTIONS ACT 2000
• Australia, QLD – ELECTRONIC TRANSACTIONS (QUEENSLAND) ACT 2001
• Australia, VIC – ELECTRONIC TRANSACTIONS (VICTORIA) ACT 2000
• Australia, SA – ELECTRONIC TRANSACTIONS ACT 2000
• Australia, WA – ELECTRONIC TRANSACTIONS ACT 2003
• Australia, Tasmania – ELECTRONIC TRANSACTIONS ACT 2000
• Canada – Uniform Electronic Commerce Act (UECA)
• China – Electronic Signature Law of the People’s Republic of China
• Europe – eIDAS
• New Zealand – Contract and Commercial Law Act 2017
• South Africa – Electronic Communications and Transactions Act, 2002
• UK – Electronic Communications Act 2000 (chapter 7)
• U.S. – Electronic Signature in Global and National Commerce Act (ESIGN)
• U.S. – Uniform Electronic Transactions Act (UETA)- adopted by 48 states

Nothing on this page constitutes legal advice.