A client posed a question to me this week: are contracts enforceable when the customer signs via an installer’s or sales rep’s iPad? Yes, I responded, electronic signatures are valid under federal and most states’ laws. But, the follow-up question required more research– if a customer signs on the iPad, each customer’s signature will originate from the same iPad– the same IP address– so how do you prove that it was the customer that actually signed it and not the employee “robo-signing” (to borrow a term from the mortgage foreclosure crisis) contracts for his or her customer? Good question. Here is the answer.
Both E-SIGN and UETA require that the signature be attributable to the customer. That is, the signature is valid even if it is electronic, but you must still be able to show that it was the customer who signed and not someone else who didn’t have authority to sign. So, the customer can still challenge the contract, claiming that he/she did not electronically sign or authorize the signature.
How, then, should you go about showing that the electronic signature you received is attributed to your customer?
Here is what the UETA says:
“An electronic record or electronic signature is attributable to a person if it was the act of the person. The act of the person may be shown in any manner, including a showing of the efficacy of any security procedure applied to determine the person to which the electronic record or electronic signature was attributable.”
So, if your customers are signing via iPad, or other portable electronic device, you can prove it is the customer’s signature in any manner, including your security procedures. That gives you a lot of leeway to craft your own procedures. You could even rely on your Honest-Abe employee’s word (and memory about every transaction)–probably not recommended. But here are some of the ideas my client and I came up with:
- Swiping the customer’s driver’s license or ID card.
- Taking a photo of the customer’s driver’s license or ID card.
- Having the iPad take a photo of the customer as they are signing.
In conjunction with these security procedures, you need your customer’s signed consent for the electronic contract and electronic signature, which also states that the customer is providing a driver’s license/ID card or photo while signing as proof that the contract is attributable to him or her. This consent could also be signed electronically.
Then, if a customer questions the signature, you’ll have the consent and their driver’s license or photo to back it up. Sounds easy enough. But I’d like to hear from any of you who have the customer sign on a portable electronic device. Tell me what you do and how it’s working for you.