Legal Digital Signatures

Digital signatures (unlike electronic signatures) are more often used as a method of showing affirmative purpose. The troubles with digital signatures do not ensue from agreement to terms, but rather from the security and confidentiality of the digital signatures. Virtually, digital signatures are encrypted electronic signatures that a third party (certification authorities) authenticates as original. Unlike the more general electronic signature, a digital signature must be unique and rigorously under the sole custody of the party using it. Unlike electronic signatures, where a typed name, a company name or even a logo can all bind the party to be charged by its mere presence, digital signatures offer the agreeing party greater levels of security and efficiency. The general types of signatures will not be enforceable as a digital signature. Because of the authentication requirements, digital signature should be recommended that clients rely on the use of digital signatures for any high-profile or high liability electronic contract.

Digital signature use will only increase in use in the future, as parties to all transactions will seek a heightened level of information security without the fear of accidentally agreeing to unfavorable terms. While there is an inherent fear of paperless transactions, especially with more traditional attorneys and companies, the use of digital signatures makes commerce faster, more secure and more effective and should be recommended to clients when appropriate. The use of digital signatures is even more effective when dealing in international trade, making it no longer necessary to fly overseas in order to demonstrate intent to sign a contract.

While understanding and diligent advising clients to the use of different forms of signatures for electronic commerce is significant, it is also very important to understand that we are still in the early years of a technological revolution, and that part of being an effective advocate is keeping up to date on advancements in the law. Electronic and digital signatures are only the beginning. Progress in technology will soon allow for the widespread use of biometric identification as a method of showing purpose of contract. Rules of contract law will continue to evolve with technology and while the application of contract principles and the Statute of Frauds will not substantially change, their interpretation and use surely will.

Read about Legal Electronic Signatures.