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Streamline your practice with e-signatures
Most Illinois attorneys will be very familiar with provisions permitting a contract to be executed in multiple counterparts, all of which become part of the final agreement. Similarly, many practitioners have become accustomed to inserting clauses providing that electronic signatures, PDF copies, facsimile signatures and other non-“original” signatures are valid and deemed to be originals. While these provisions save time for attorneys – each side of a deal can circulate a signature page to its own signatories and then assemble a fully-executed version with multiple signature pages – many attorneys are not yet taking advantage of the use of truly electronic signatures (“e-signatures”) to streamline their practices.
Implementing and using e-signature services has become increasingly simple and cost effective, and attorneys should be aware of the benefits of e-signatures for their clients and themselves. Keeping up to date on developments in legal technology is a part of every attorney’s duty of competence, as set forth in comment 8 to Model Rule 1.1, which provides that “to maintain the requisite knowledge and skill, a lawyer should keep abreast of changes in the law and its practice, including the benefits and risks associated with relevant technology…”1 As the use of e-signatures increases, so too does the need for every attorney to become acquainted with this technology.
Legal Background – Bringing E-Signature to Life with the New Millennium
In July 1999, Illinois enacted its first law regarding electronic records and signatures, the Electronic Commerce Security Act (“ECSA”).2 Contemporaneously, the Uniform Law Commission was completing its preparation of the Uniform Electronic Transactions Act (“UETA”)3 and the U.S. Congress was crafting the Electronic Signatures in Global and National Commerce Act (“ESIGN Act”),4 which came into effect one year later. The ESIGN Act and UETA are quite broad, generally permitting the use of electronic records and signatures and enunciating the policy that a record or signature should not be held invalid simply because of its electronic form. The Illinois ECSA goes quite a bit further, prescribing specific security measures that must be used, detailed descriptions of the responsibilities of e-signature services and e-signatories themselves, as well as penalties for fraudulent use of e-signatures.
Common Features of E-Signature Services
Fortunately for practitioners, the e-signature service marketplace has expanded considerably in recent years, with many choices now available. The most widely-used e-signature services include DocuSign, eSignLive, Adobe Sign, and SignNow,5 though dozens of other services are available with varying feature sets and at varying price points. Most e-signature service providers offer plans in the range of $10 per month, but added users and added features usually bring added cost.
Common features of many e-signature services include the ability to allow recipients to add not just their signatures or initials, but to add additional text to “fill in the blanks” in a document, check boxes, select from drop-down menus, and more. Most e-signature services will also allow the sender to automatically capture the date of an e-signature and insert it in the document, providing further verification of the actual date of signing.
Most e-signature services are very user-friendly, both for the sender and for the signatory. For a sender, highlighting fields for signature or other input takes only a few seconds. For a signatory, a notification will arrive by e-mail with a secure link to the document itself. If on a desktop or laptop computer, the signatory can usually draw his or her own with a mouse, or select from a signature-like font. On a smartphone or tablet, the signatory can simply use a finger to draw a signature directly on the screen, then return the executed document with a few taps.
Once all e-signatories to a document have signed, e-signature services will compile a single document including all of the signatures and other information entered by signatories, eliminating the need to cobble together a fully-executed document with multiple signature pages.
Benefits and Limitations of Use
Cost Savings
As many small firms and solo practitioners are working to tighten their belts and streamline their practices, e-signatures remove the need for using postage and mailing supplies, providing measurable cost savings, especially for those practicing in areas that can be particularly signature-intensive, such as real estate.
Time Savings
Especially when time is of the essence, e-signatures can be vital. Using e-signatures, the turnaround time for sending a document and receiving an executed copy can be a few minutes, rather than the hours it would typically take to send a PDF via e-mail, wait for the signatory to print it, sign it, find a scanner, and e-mail it back. Similarly, the days-long turnaround times for mailing a document and receiving an executed copy can, and should be, eliminated by practitioners where possible for the sake of efficiency and improved client service.
Security
The Illinois ECSA prescribes a specific verification procedure, known as an asymmetric cryptosystem, for showing that an e-signature is the intended act of the signatory. Each e-signature must be accompanied by a “public key,” a unique set of characters that corresponds to a “private key,” which the e-signature service retains. Only the unique public key can “unlock” the private key to verify the authenticity of the signature. While the two keys must be mathematically related, the ECSA requires that it be “computationally unfeasible to discover the other key (the private key).”6
Limitations of E-Signature in Illinois
The Illinois ECSA generally provides for the recognition of electronic records and signatures, but contains a few important exceptions, including wills, trusts and powers of attorney for health care, as well as negotiable instruments or other instruments of title where possession of the instrument legally confers title.7 The Illinois ECSA also provides a catch-all exclusion, where if the law’s “application would involve a construction of a rule of law that is clearly inconsistent with the manifest intent of the lawmaking body or repugnant to the context of the same rule of law,” an e-signature will not be considered valid. However, the ECSA clarifies that simply because a law requires that information be “in writing”, “written”, or “printed” does not establish the requisite intent.
Although many Illinois attorneys already use e-signature services, further adoption of e-signature by practitioners will continue to streamline their practices, saving time and money and improving the client experience, both in convenience and efficiency.