By Dan Puterbaugh, director and associate general counsel at Adobe's Document Cloud Division
You know using electronic signatures will make your job easier. You'd love to never again have to chase down a signature, cram papers into a filing cabinet, or waste time running to the fax machine. Maybe you could get rid of that fax machine altogether.
But there's a problem: your legal team. "Electronic signatures are too risky," they say. "Think of all the things that could go wrong." They mean well… it's just that they're trained to avoid risk.
But they're also trained to appreciate logic. So next time you're standing beside the fax machine for eight minutes before realizing it's out of paper, ruminate on these five points that lawyers will love:
1. Even the Victorians accepted electronic contracts.
Electronic signatures have been legal in the US since 2000, but their history goes back a long way. In 1869, the New Hampshire State Supreme Court ruled that intent could be verified electronically — in those days, by telegraph, but the ruling refers to electricity as a medium comparable to ink. Since intent is what counts, the medium the signature is created in doesn't matter to a judge.
2. Electronic signatures create a mountain of evidence.
All it takes to forge a signature is a pen and one opposable thumb. But electronic signatures from reputable companies like Adobe carry a lot of information about a signer. Identification, authentication, and attribution are built into most electronic signature technologies, recording information such as the signer's IP address, GPS location, and even how long they spent reviewing the document. All of these data points add up to evidence — often evidence that is far more compelling than that offered by handwritten signatures.
3. All their friends are doing it.
Lawyers think about legal consequences. That's their job. Fortunately for your overloaded file drawer, other lawyers have already worked through the legal concerns surrounding electronic signatures in the areas of admissibility, compliance, and repudiation. And they're fine with them.
Electronic signatures are admissible as evidence in litigation, according to the US ESIGN Act and a number of state laws that designate electronic signatures as legally enforceable. Likewise, electronic signatures help ensure regulatory compliance, since Federal and state governments accept them as valid. Plus, electronic signatures and the documents they validate are stored digitally, so contracts can't be lost or accidentally destroyed; a reliable record of actions is always available. Repudiation occurs when a signer denies signing a document or claims the document was edited after he signed it. However, the digital information associated with an electronic signature contains proof of both a signer's identity and the document's integrity.
4. Think of the shareholders.
A lawyer's job is to protect the client's interests, and a corporate client's interests are to increase value for shareholders or owners. That means streamlining processes whenever possible. Rather than refuse to adopt a technology that will reduce costs by increasing efficiency, lawyers should be looking for ways to make the technology work. But assure your legal team that they don't have to dive headfirst into the deep end. They can…
5. Just dip a toe.
A first experience with electronic signatures doesn't have to be all or nothing. Try the technology in a limited way on a low-risk project. A good entry point would be non-disclosure agreements (NDAs). Every legal department struggles to handle the avalanche of these low-risk, high volume agreements. Showing your lawyers how electronic signatures can make their lives easier is a great way to help them understand just how valuable this technology can be for your entire organization.
Your legal department will see the light when you speak their language — the language of logic. When your lawyers understand that electronic signatures have a long history of legal acceptance, are hard to hack, are valid under federal, state and most foreign law, and can be implemented in safe phases, there are really no concerns left to stop your organization from accepting signatures in a better, faster way. Now you've only got one problem left — what to do with that open space where the fax machine used to live. Maybe get a fern?
For further reading, download the ACC Docket article “Sign Here: Electronic Signatures and the In-house Counsel” by Rachel Stoermer, senior corporate counsel at DocuSign. Learn how to best instruct clients on taking advantage of the numerous electronic signature tools available that enable your executives to sign from anywhere they can connect to the Internet.