The Statute of Frauds in the Digital Age - Maintaining the
Integrity of Signatures
| Authors: |
Sharon Christensen LLB (Hons), LLM
Gadens Professor in Property Law, Queensland University of Technology Faculty of Law
|
|
William Duncan LLB, LLM
Professor, Queensland University of Technology Faculty of Law
|
|
Rouhshi Low
Senior Research Assistant, Queensland University of Technology Faculty of Law
|
| Issue: |
Volume 10, Number 4 (December 2003)
|
Contents:
- Many countries such as the United States, the European Union, United
Kingdom, New Zealand and Australia have introduced legislation
to facilitate
the increased usage of the Internet as a medium for contracting. The use of
the internet for commercial transactions
involving the sale of goods, aside
from the question of security, requires only minor adjustments to the
contractual law principles
which apply to the transactions. In contrast, the
use of the Internet for land transactions is hampered by the need to
reconceptualise
the accepted notions of writing and signature for use in
electronic transactions. In most common law jurisdictions the Statute
of
Frauds imposes a requirement for land transactions to be in writing and signed
by the party to be charged. This article
examines the development of the legal
requirements for a signature in paper based land contracts in Australia using
Queensland
as an exemplar for other Australian jurisdictions and considers the
following issues, in particular
- the conditions required by the Statute of Frauds for a valid signature;
- whether an electronic signature affixed to an electronic contract can
serve the same functions as a manuscript signature for
the purposes of the
Statute of Frauds;
- different frameworks developed for regulating electronic signatures and
the degree to which these frameworks meet the functional
requirements of the
Statute of Frauds.
- The article propounds the view that current Australian legislation
purporting to validate electronic transactions provides inadequate
protection
to parties entering electronic land transactions. The Australian legislation
does not change the substantive requirements
of the Statute of Frauds but
purports to mandate the validity of electronic signatures provided certain
criteria are met. It
is suggested that the criteria, when examined in light of
the reasons for signing a document in accordance with the Statute of
Frauds,
are insufficient to ensure an electronic signature meeting those requirements
performs the same functions as a manuscript
signature. The article urges the
adoption of the two tiered approach in the Model Law on Electronic Signatures,
Article 6 of
which provides standards against which technical reliability of
electronic signatures may be measured without limiting the availability
of the
flexible criterion embodied in Article 7 of the UNCITRAL Model Law on
Electronic Commerce, which is reflected in the
current legislative framework
in Australia.
- Very little judicial or academic
comment exists to define a signature. It is suggested that this is because it
is universally
understood that a signature is a signatory's name written in
their own hand on a piece of paper.[1]
However, in some cases courts have accepted a range of signatures including
crosses, initials, printed names and rubber stamps
all by analogy with a
written signature.[2]
This was achieved by determining if the method had already been recognised as
valid and if not, whether it was acceptable in
the particular circumstances.
No reasons or general principles were given, with the court in each case
merely satisfying itself
that the method achieved the same purpose as a
personal signature.[3]
- Several authorities have considered the meaning of 'signed' at common law. It
is clear that modern authorities are more concerned
with whether the
particular signature fulfils the function of a signature as intended by the
legislation rather than whether
the signature is in a particular form. Sir
Raymond Evershed MR in Goodman v J Eban[4]
stated that:
"It follows, then, I think, that the essential requirement of signing is
the affixing, either by writing with a pen or pencil or
by otherwise
impressing on the document, one's name or signature so as personally to
authenticate the document"
- Romer LJ in the same case agreed stating:
The first reaction of many
people, I think, would be that the impression of a name produced by a rubber
stamp does not constitute
a signature, and, indeed, in some sense, is the
antithesis of a signature. When, however, the matter is further considered in
the light of authority and also of the function which a signature is intended
to perform one arrives, I think, at a different
result."[5]
- In summary, the authorities indicate a concern to ensure that the function
of requiring a signature is met by whatever method is
used, but to date, the
ordinary meaning of signature as being a mark on a written document has
prevailed in the authorities.
- The Statute of
Frauds requires that particulars documents be signed. An examination of the
cases shows that the fact an actual
signature is not the result of the act of
signing is not critical to the validity of the document. Even a form with a
signature
impressed upon it by a printing machine[6]
or where the person signing places upon the document an engraved
representation of that person's signature by means of a rubber
stamp[7]
have been held to satisfy the statutory requirement of a signature. A telex
signature has also been held to be sufficient to
constitute a proper
signature.[8]
The critical element appears to be that the signature must also contain the
additional characteristic that the person making
the mark approves of the
contents of the document.
- The mere existence of a person's name in a document
without the characteristic of adoption of the document or approval of its
contents, will not be a signature for the purposes of the Statute of Frauds
because it does not effectively authenticate a document.
Thus, a printed name
in the body of an instrument to operate as a signature must be authenticated
by the person to be charged.[9]
This view appears to have been followed in Australia.[10]
By this authentication, the party to be charged must expressly or impliedly
indicate that he or she recognises the writing
so containing his or her name
or initials as being an expression of the will to contract.[11]
- In Queensland[12]
s 59 of the Property Law Act 1974 (Qld) provides for a contract or memorandum
to be "signed" by the party to be charged. The Acts Interpretation Act 1954
(Qld) defines "sign" as including "the attaching of a seal and the making of a
mark", but does not define signature. Under
the Statute of Frauds as reflected
in s 59 of the Property Law Act 1974 (Qld), a signature serves the following
functions:
- it identifies the signatory; and
- evidences the party's approval of the contents of the document;
[13] and
- provides integrity for the contract between the parties ensuring the
reliability and admissibility of the parties' agreement in
a court.[14]
- Underlying the ability of a signature to serve these functions are several
important characteristics:
- a signature is usually affixed through a
physical process by the signatory or a person authorised by the signatory;
- a signature can be affixed by mechanical means unless prohibited;
- a
signature is relatively difficult to effectively forge;
- the signature
becomes affixed to the document such that the signature, document and contents
become one composite physical thing;
- a signature is relatively difficult
to remove without a trace;
- can be reproduced by a party and is relatively
standard for all documents signed by the same person.[15]
- Given that these particular characteristics result in the fulfilment of
certain functions, the challenge is whether an electronic
version of a
signature with similar characteristics will be able to fulfil the same
functions. Before considering the application
of current Australian and
international legislation to the signing of a land transaction it is
instructive to consider how
an electronic signature would be viewed in the
absence of specific legislative provisions validating its use.
- There are several ways that a party to an electronic contract may attempt
to sign the contract:
- Using a manuscript signature which is scanned as an
image into a word processing file so that the document may be printed out for
transmission by post or otherwise;
- Typing a name at the bottom of an
email or document;
- Using a digital signature
- All of these methods may be generically termed electronic signatures as
they are methods of affixing a form of authentication to
an electronic
document. This should be distinguished from a "digital signature" which is a
specific form of electronic signature
involving encryption.
- Each of the methods described above will have variable success in meeting
the requirements for a valid signature at law. In all
cases if the law were to
require a signature to take the form of a mark on a document such that it
could not easily be removed
or reversed, no electronic signature could satisfy
the requirement. This is due to the fact an electronic document is not a
physical object and any method for signing in an electronic environment will
not take the form of a permanent affixation to the
document. As discussed
later, even a digital signature is merely an extra set of bits attached to the
document or logically
associated with it and as such it may be possible to
remove the signature.
- Further difficulties with some forms of electronic
signatures is that while they may make a mark on the document this mark does
not necessarily identify the party, indicate the party's approval or become
permanently affixed to the document. These difficulties
were identified by
Staughton J in Clipper Maritime Ltd v Shirlstar Container Transport Ltd (the
'Anemone')[16]
where his Honour considered whether a telex might satisfy the requirement for
writing and signature of a guarantee for the
purposes of the Statute of Frauds
1677. His Honour stated:
I reached a provisional conclusion in the course of
the argument that the answerback of the sender of a telex would constitute
a
signature, whilst that of the receiver would not since it only authenticates
the document and does not convey approval of
the contents.[17]
- While it was not necessary for his Honour to make a final decision in
relation to this issue, acceptance at face value of the suggestion
that an
automated message could act as a signature ignores the following issues:
- the identification message of facsimiles and telexes only identifies the
machine and not the identity of the sender;
- it is possible for a false identification message to be sent; and
- the contents of the message can be altered and replaced to be virtually
untraceable.
- In particular, using one of the first two electronic
signature methods outlined above[18]
will not satisfactorily evidence:
- that the party placing the signature on
the document was actually the person stated;
- that the person placing the
signature on the document actually approves of its terms; or
- that the
signature was not forged, placed on the document by another party or that the
signature was not removed from one document
and placed on a different
document.
- However, if emphasis is placed more on the function of a signature as
developed in the authorities it may be possible to accept
that an electronic
document can be signed. The main functions served by a party signing a land
transaction are to authenticate
the document (that is to identify the party
and the party's intent to enter the transaction) and to guard against a later
fraudulent
attribution of the transaction to a party. Of the methods described
above only the final method could possibly equate functionally
to a personal
handwritten signature. If the courts were to view the principles developed in
light of modern electronic communications
and depending upon the type of
technology used it may be possible to adopt the view that a digital signature
authenticates
the document and, therefore, will be functionally equivalent to
a personal signature.
- Therefore, while a document may be signed in a number of different forms,
the Statute of Frauds would require an electronic signature
to have the
following key characteristics:
- it should be capable of being affixed to the
electronic document and making a mark on the document;
- it must indicate the
party's approval of the contents of the document;
- it must be capable of
identifying the party who has affixed the signature;
- it must have the same
quality of integrity as a written signature such that if the signature has
been removed from the document,
falsely affixed to the document, forged by
another party or the contents of the document have been altered this could be
easily
established where the reliability of the document is called into
question.
- A digital signature using public key or
dual key cryptography is operated using two keys, a private key and a public
key. The
private and public keys are referred to as a public key pair. The
keys will be two large prime numbers[19]
mathematically related to each other but mathematically impossible to
determine the private key by simply knowing the public
key. The private key
should be treated like a pin number and kept secret by the holder of the key.
Signing a document
- Firstly, a mathematical process (called a "hashing
algorithm") is used to create a summary of the message. This summary will be
unique to the message and it is highly improbable that two different messages
will produce the same message summary.[20]
This hashing mechanism is irreversible. The message will produce the same
message summary every time the algorithm is used
on the same text. Advantages
of this process are:
- the message summary is shorter and therefore quicker to
decrypt; and
- a small change in the text will produce a large change in the
message summary.
- Next the summary of the message is encoded with the sender's private key.
The key will usually be contained on a smart card which
is inserted into the
sender's computer. Using the information on the card the computer performs a
mathematical process which
encodes the summary with the private key.
Diagram - Signing a document with a private key [21]
Decoding a document
- The sender sends to the recipient the coded summary
together with the plain text of the message and a certificate from a
Certification
authority which contains the sender's public key.
- Next the recipient of the message creates a new summary of the plain text
message using the same mathematical process (hashing
algorithm) that was used
in the first stage by the sender. Finally the recipient will use the public
key of the sender to decode
the coded message summary. The two summaries will
be compared and if they are the same it is proved that the message was signed
using the private key corresponding to the public key but this does not prove
that the private key belongs to the sender.[22]
Diagram - Decoding a message with a public key [23]
- As identified by McCullagh, Caelli and Little[24]
a digital signature has certain physical characteristics:
- it is a series of bits that are attached to, or logically associated
with another set of bits known as the digital document;
- it can easily be
reproduced by the same person provided they have access to a computer,
software, their private key and a digital
document;
- it is easily
verified by document receivers and independent third parties;
- are
difficult to forge by third parties unless the forger has obtain access to the
private key;
- are not permanently bound to the document such that the
contents of the digital document and the digital signature come one
indivisible series of bits;
- involve a mathematical process;
- are
exactly the same for all documents that are exactly the same when signed by
the same person;
- are easy to remove without leaving a trace.
- A digital signature will have the following characteristics in common with
a handwritten signature:
- both signatures can be affixed through a mechanical means by the
signatory or a person authorised by the signatory;
- the difficulty of forging a handwritten signature and a digital
signature are arguably similar, however, in the case of a digital
signature
stored on a smart card it could be stolen and used if the password is
carelessly made available. A handwritten
signature could not be copied in
this way and any copy could be detected by an expert;
- both signatures can be reproduced by a party and is relatively standard
for all documents signed by the same person.
- The characteristics of a handwritten signature that a digital signature does not possess are:
- A handwritten signature is affixed to a document using a physical process. It is arguable that this characteristic is not essential
to the functions of authentication and integrity as affixation by mechanical means has been considered acceptable.
- A handwritten signature becomes affixed to the document such that the signature, document and contents become one composite physical
thing. A digital signature is a series of bits that are attached to, or logically associated with another set of bits known as the
digital document. In an electronic environment using current technology, a merging of the signature with the document will not occur.
Whether this will prevent a digital signature from effectively authenticating a document or maintaining its integrity will depend
on how easy it is to disassociate the signature from the document.
- A handwritten signature is relatively difficult to remove from the document without a trace. McCullagh, Caelli and Little[25]
suggest that the technology is available for a fraudulent third party to be able to strip a digital signature from a document without
a trace. Despite this flaw the authors go on to provide a variety of mechanisms that may be used to protect the digital signature
or put the parties on notice that there may be a problem. This will be an important issue in a land transaction where the identity
of the party is confirmed by the signature used;
- A handwritten signature will generally be a version of the signatory's name allowing for easy identification of the party. A digital
signature will appear as a jumbled series of numbers somewhere on the document. This will not on its face identify the signatory
but the fact the electronic document can be decoded using the public key of the signatory and the subsequent verification of the
identity of the person which that particular key allows for proof of the identity of the person who signed.
- Despite the lack of an exact correlation between the characteristics of a handwritten signature and a digital signature the writers
are of the view that given the current technology it is possible for a digital signature to perform the same functions as a handwritten
signature.
- In the writers' view a digital signature is able to achieve the requirements of the Stature of Frauds in relation to the identity
of the signatory, approval of the contents of the document and maintenance of the integrity of the document in the following ways:
- Using a digital signature as described above only proves that the document was signed using a particular private key, it does not
identify the signer. To establish the identity of the signer it will be necessary to refer to extrinsic evidence such as a certificate
provided by a Certification Authority.[26]
As stated above, after signing the message, the sender sends to the recipient the coded summary together with the plain text of the
message and a certificate from a Certification Authority which contains the sender's public key. This certificate, which is also
digitally signed by the Certification Authority contains the following:
- the signatory's public key;
- the signatory's name and email address;
- the Certification Authority's name and email address;
- the serial number of the certificate and its validity period
- The need for a digital certificate does not in the view of the writers detract from the ability of a digital signature to identify
the party signing, but it is one of the factors which make it necessary for legislative intervention to validate the use of digital
signatures.
- Once a digital signature is affixed approval of the contents of an electronic document should be assumed (as is the case for a handwritten
signature).[27]
However, there may be instances where a third party is able to affix the signature without the knowledge of the individual. An individual
may keep a signature key stored on a physical token, such as a smart card, which is needed for the operation of the signature software.
It may be possible for a third party, through the carelessness of the card holder (if they also have access to the password) to use
the card and affix a person's signature on a document. This additional likelihood of a party's carelessness playing a part in the
fraudulent use of a person's private key may persuade a court that the same assumption of approval should not be adopted for digital
signatures. The court may require a party seeking to rely on the validity of the signature to adduce extrinsic evidence that the
signature was applied with the signatory's authority.
- Therefore, although a digital signature on its face is capable of proving the approval of a party to the transaction, a court may,
given the untested nature of digital signature technology in a court, take a conservative view of the evidence required to prove
approval of an electronic document.[28]
This may necessitate the signatory where a dispute about attribution arises to provide evidence that the digital signature was not
affixed with the signatory's authority or knowledge.
It is the writer's view that the possibility of fraud does not detract from
the functionality of a digital signature. These situations can be compared within physical media with the ability of a fraudulent
individual to forge a signature or impersonate an individual. The fact that these types of fraud can be perpetrated have not historically
affected the ability of handwritten signatures to perform an authenticating function.
- The third function a digital signature is required to perform for the purposes of the Statute of Frauds is to indicate that the document
has not been altered since it was signed. Within an electronic environment the question of integrity will involve two issues:
- Can a digital signature prove the integrity of the electronic document?
- Given that a digital signature is not permanently merged with the electronic document, is it also necessary to ensure the integrity
of the digital signature?
- In relation to the first issue the integrity of the document can be determined using the one way hash function described above. The
recipient decodes the coded message summary using the sender's public key. The two summaries can be compared. If the document has
been changed after signing the two messages will be different and the recipient will know that the document has been altered.
- The second issue arises because a digital signature is only associated with the document and does not become an indivisible part of
the document in the same way as a handwritten signature. The signing of a document by a digital signature has been compared by McCullagh,
Caelli and Little[29]
to using a paper clip to affix a signature to a document. The paper clip can be removed without leaving a trace in the same manner
that a digital signature can be removed from an electronic document. Despite this potentially fatal flaw, it is possible, as suggested
by McCullagh, Caelli and Little[30]
to ensure the integrity of the digital signature through encryption with the recipient's public key or through the use of a trusted
third party who time stamps the lodgement of the message summary.
- From the above discussion it can be seen that there exists some uncertainty as to whether an electronic signature will be capable
of matching the characteristics and functionality of a hand written signature. Arguably only a digital signature will be capable
of fulfilling the requirements of the Statute of Frauds.
- The following provides a comparative overview of the different approaches in defining an electronic signature and considers which
approach best satisfies the functional objectives of a signature for the purposes of the Statute of Frauds. The frameworks used for
this discussion are:
- UNCITRAL Model Law on Electronic Signatures. Although this is only a model framework and has no prescriptive force, it is useful
for the purposes of this article to analyse its provisions as it could be adopted by Australia if found to satisfy the objectives
of the Statute of Frauds, particularly so as Australia's Electronic Transactions Act is based on the UNCITRAL Model Law on Electronic
Commerce and the Model Law on Electronic Signatures builds upon the signature provisions of the Model Law on Electronic Commerce.
- The Electronic Transactions Act, Queensland. This legislation was chosen as an exemplar of the Australian framework.
- The Uniform Electronic Transactions Act, United States. This legislation is discussed because it has a different definition of an
'electronic signature' to the Australian legislation.
- The European Union Electronic Signatures Directive. This directive is an example of a two-tier approach which differs in terminology
to the UNCITRAL Model Law.
- Electronic Transactions Act, New Zealand. This legislation provides an example of a framework with a two tier framework for electronic
signatures.
- The UNCITRAL Model Law on Electronic Commerce was adopted by the United Nations Commission on International Trade Law (UNCITRAL) in
1996 in furtherance of its mandate to promote the harmonization and unification of international trade law. The purpose of the UNCITRAL
Model Law on Electronic Commerce is to offer national legislators a set of internationally acceptable rules that deals with the removal
of statutory barriers to electronic commerce.
- Following from the Model Law on Electronic Commerce, the Model Law on Electronic Signatures was adopted in 2001, the purpose of which
is to bring additional legal certainty regarding the use of electronic signatures.[31]
The Model Law on Electronic Signatures has no prescriptive force but is intended to serve as a model law for member states in the
enactment of legislation dealing with electronic signatures. Thus far, only Thailand has adopted legislation based on the Model
Law.[32]
- The Model Law on Electronic Signatures builds upon Article 7 of the Model Law on Electronic Commerce. It establishes a presumption
that, where certain criteria of technical reliability are met, electronic signatures shall be treated as equivalent to hand-written
signatures. The Model Law on Electronic Signature also contains basic rules of conduct dealing with responsibilities and liabilities
that might bind upon the various parties involved in the electronic signature process, such as the signatory, the relying party and
trusted third parties.
- The Model Law on Electronic Signatures follows the two tier approach to authentication. The first and broader regime is that described
in article 7 of the UNCITRAL Model Law on Electronic Commerce. Article 7 recognises any electronic signature method that is applied
for the purposes of signing a data message as fulfilling the legal requirements for a handwritten signature provided that it is sufficiently
reliable in the light of all the circumstances. The second and narrower regime is that created by the Model Law on Electronic Signatures.
It contemplates methods of electronic signature that may be recognized by a State authority, a private accredited entity, or the
parties themselves, as meeting the criteria of technical reliability set out in article 6.
- Article 6(3) lists the criteria to be satisfied in order for an electronic signature[33]
to be considered to be reliable. These are:
- (a) The signature creation data are, within the context in which they are used, linked to the signatory and to no other person[34]
Under this requirement the linkage between the data used for creation of the signature and the signatory[35]
is the essential element. Thus although the signature creation data can be shared with different users, the signature creation data
must be capable of identifying one user unambiguously in the context of each electronic signature.[36]
The term "signature creation data" is not defined in the Model Law on Electronic Signatures. According to the Guide to Enactment,
the description covers those core elements which should be kept confidential in order to ensure the quality of the signature process.[37]
- (b) The signature creation data were, at the time of signing, under the control of the signatory and of no other person
Subparagraph (b) requires the signature creation data to be under the sole control of the signatory at the time when the signature
creation data are used.[38]
The Guide to Enactment provides an example of a situation where the signature creation data exists on a network and is capable of
being used by a number of people. The network would presumably relate to a particular entity which would be the signatory. If the
signature creation data were widely available, they should not be covered by the Model Law.
- (c) Any alteration to the electronic signature, made after the time of signing, is detectable
Subparagraph (c) deals with the issues of integrity of the electronic signature. The purpose of this paragraph is to set forth the
criteria to be met in order to demonstrate that a particular method of electronic signature is reliable enough to satisfy a requirement
of law for a signature.
- (d) Where a purpose of the legal requirement for a signature is to provide assurance as to the integrity of the information to which
it relates, any alteration made to that information after the time of signing is detectable.
Subparagraph (d) deals with the integrity of the information being signed electronically. According to the Guide, it is intended primarily
for use in those countries where existing legal rules governing the use of handwritten signatures could not accommodate a distinction
between integrity of the signature and integrity of the information being signed. In subparagraph (d), the necessary linkage between
the signature and the information being signed is expressed so as to avoid the implication that the electronic signature could apply
only to the full contents of a data message.[39]
- It is the writers' view that a signature meeting the requirements of Article 6 of the Model Law on Electronic Signatures will also
satisfy the functions of a signature as required by the Statute of Frauds: such a signature will be capable of identifying the signatory,[40]
indicating the signatory's approval of the contents of the document as well as well proving the integrity of the electronic document.
- However, one potential problem with the Model Law is that the conditions listed in article 6(3) are not the only method for establishing
reliability of an electronic signature, article 6(4)(a) provides that reliability may be established in any other way.[41]
According to the Guide to Enactment, paragraph 4 is intended to "provide a legal basis for the commercial practice under which many
commercial parties would regulate by contract their relationships regarding the use of electronic signatures".[42]
There is however no explanation or examples for what may consist as other ways for establishing reliability.
- The Electronic Transactions (Queensland) Act 2001 (Qld) is part of the national framework of electronic transactions legislation. Each of the States in Australia has passed an electronic
transactions Act with provisions similar to the Electronic Transactions Act 1999 (Cth). The Commonwealth Electronic Transactions Act is based on the UNCITRAL Model Law on Electronic Commerce.
- Section 14 of the Electronic Transactions (Queensland) Act 2001 (Qld) purports to deem the requirement under a State law for a signature to be met by an electronic signature which meets certain
criteria. There are two broad requirements for an application of s 14:
- 1. The signature of a person must be required by a "State law"
Section 14 will apply where a State law, in this case s 59 of the Property Law Act 1974 (Qld), "requires" a signature. The primary question to be asked is whether s 59 of the Property Law Act 1974 (Qld) requires a contract or memorandum to be signed.[43]
Section 59 simply provides that a contract will not be enforceable unless it is in writing and signed by the party to be charged, but it does
not actually "require" that the contract be in writing or signed.[44]
To overcome this problem the word "require" under s 14 of the Electronic Transactions Act would need to be broadly interpreted to include not only a positive obligation but also a where failure to comply will result in
an invalid transaction. It is suggestion that it is possible to take a wide view of requirement as being either a command or the
provision of negative consequences if the document is not signed.[45]
- 2. The signature method used must meet the following criteria:
- (a) the method used identifies the person and indicates the person's approval of information;
The explanatory memorandum to the Queensland Electronic Transactions Act does not explain what is required by this condition. Guidance can be obtained from the explanatory memorandum to the Electronic Transactions Act 1999 (Cth) which[46]
provides that this condition merely requires that the signature method used must allow a person to indicate his/her approval of the
information contained in the communication.[47]
This can then be used to establish that person's intention to apply his/her signature to the information contained in the electronic
communication. In establishing the person's identity the signature method need not necessarily be a unique identifier, but it must
identify that person sufficiently for the purposes of that communication.
- (b) the method used is as reliable and appropriate for the purpose for which the information is communicated;
According to the Explanatory Memorandum to the Commonwealth Electronic Transactions Act, the reliability and appropriateness of the signature method is to be determined having regard to all the relevant circumstances
at the time the signature method was used to sign the electronic communication. This requirement is intended to ensure that a signature
method that was appropriate at the time it was used is not later rendered invalid.[48]
With regard to this condition, the purpose of the Property Law Act 1974 (Qld) in requiring a signature and the functions that the signature serves will be relevant to any consideration of reliability and
appropriateness. A crucial factor will be the ability of the signature method to authenticate the document and maintain the integrity
of the document for later reference. As discussed, this can be achieved where a digital or biometric signature is used.
- (c) the person to whom the signature is required to be given consents to the requirement being met by using the method
Section 59 merely requires the signature of the party to be charged to appear on the document, there is no requirement for the signature to
be given to a particular person. The party to be charged may ultimately be either of the parties to the transaction. It is therefore
suggested that both parties will need to consent to the method being used. The type of consent that will be acceptable under this
section may be narrower than s 11 as the person needs to consent to "the method". For proper consent to be given the person will need to know what method is being
used. Accordingly, consent may occur expressly or due to a previous course of dealing.
- If the above conditions are satisfied, s 14 then provides that the requirement for a signature will be "taken to have been met for an electronic communication". This deeming
provision will not however, prevent the signature from being challenged as a forgery in the same way as a manuscript signature. The
only effect is that the signature cannot be challenged merely because it is in electronic form. It must still meet the functional
requirements identity, approval and integrity as reflected in s 59 of the Property Law Act 1974 (Qld).
- As indicated above, one of the primary objects of s 59 (and other Statute of Frauds equivalents) is to prevent fraudulent practices. Thus one problem with s 14 is that it only requires the method used to indicate the person's approval of the information communicated. It does not require that
the integrity of the information be protected.[49]
One issue for a party agreeing to use an electronic signature method is whether the method is sufficiently reliable in the circumstances.
This could be an area in which the court and the parties disagree with dire consequences for the validity of the agreement.
- Secondly, s 14 does not expressly require that the signature method must be contained in the electronic communication itself. The Commonwealth Explanatory
Memorandum does however provide that the signature method used must be linked with the communication in some way in order to indicate
the person's approval of the contents of the communication.[50]
There is however no explanation as to what is required for the signature to be linked with the communication.
- Thirdly, there is no specific condition requiring that the signature method be able to detect any subsequent alterations to the document
since it was signed. This can be contrasted with the European Union Directive on Electronic Signatures and the UNCITRAL Model Law
on Electronic Signatures discussed below which specifically requires that any subsequent change of the data should be detectable.
- Finally the current definition in s 14 does not distinguish between signatures placed on the document by the signatory or those placed by a third person.
- These problems highlight one of the difficulties in using a generic definition of a signature in a transaction where the signature
traditionally was required to serve particular functions which can only be achieved by detailing a higher level of requirement. In
the writers' view the uncertainties created by this general approach need to be addressed through providing more specific criteria
for the type of signature which will be effective.[51]
- The National Conference of Commissioners on Uniform State Laws (NCCUSL) approved the Uniform Electronic Transactions Act in July 1999 for adoption by the states. The Uniform Electronic Transactions Act was drafted to conform with the UNCITRAL Model Law on Electronic Commerce. The purpose of the Uniform Electronic Transactions Act is to promote greater uniformity between the various state enacted regulations on electronic signatures. Prior to the Uniform Electronic Transactions Act, the majority of states began enacting electronic signature legislation on their own, thus creating a patchwork of various electronic
signature regimes throughout the United States. Later in 2000, the United States Congress enacted the Electronic Signatures in Global
and National Commerce Act 2000 (E-Sign Act) as an interim measure to ensure that each state will recognize the validity of electronic
signatures until such time as all states have adopted the Uniform Electronic Transactions Act.[52]
Both E-Sign and Uniform Electronic Transactions Act contain provisions specifying that electronic contracts and electronic signatures shall not be denied legal effect or enforceability
because they are electronic. The two pieces of legislation overlap significantly but they are not identical. For the purposes of
this discussion, the definitions of what is an "electronic signature" in both the E-Sign Act and the Uniform Electronic Transactions Act are similar.
- Under the Uniform Electronic Transactions Act, an electronic signature is defined broadly in terms of adopting a symbol with the intent to sign the record.[53]
Similar to the Electronic Transactions (Queensland) Act, the Uniform Electronic Transactions Act follows the principle of technology neutrality - no specific technology is required to be used in order to create a valid electronic
signature. The critical element in the Uniform Electronic Transactions Act is the intention to execute or adopt the sound or symbol or process for the purpose of signing the related record. Thus, any form
of electronic sound, symbol, or process, attached to or logically associated with a contract or other record and executed or adopted
by a person with the intent to sign the record, will constitute an electronic signature under the Uniform Electronic Transactions Act so long as:
- some affirmative step is taken by the signer, done with intent to sign the record;[54] and
- the electronic signature is linked or logically associated with a record.[55]
- Assuming that the requisite intent and association with the record, the following would qualify as an electronic signature:
- A manual signature transmitted by facsimile;
- Typed name;
- Digitised picture or image of a manual signature;
- Alphanumeric string or asterisk;
- Biometrics;
- Digital signatures;
- Clicking through a series of screens to affirm intention to make an Internet purchase;[56]
- Clicking on a button labelled "I agree" or "purchase now";[57]
- Voice on an answering machine;
- Including your name as part of an electronic mail communication or including the firm name on a facsimile.
- The Uniform Electronic Transactions Act definition also requires that the electronic signature be linked or logically associated with the record. According to the prefatory
notes and comments, in the paper world it is assumed that the symbol adopted by a party is attached to or located somewhere in the
same paper that is intended to be authenticated. However since these tangible manifestations do not exist in the electronic environment,
the electronic signature definition in the Uniform Electronic Transactions Act expressly provides that the symbol must in some way be linked to, or connected with, the electronic record being signed.[58]
- Although the drafting style and framework of the Uniform Electronic Transactions Act is more compatible with the terminology used by the Property Law Act 1974 (Qld) in respect of a land contract, it is the writers' view that the signature provisions under the Uniform Electronic Transactions Act are inadequate to ensure that the electronic signature used serves the same function as a manuscript signature as required under
the Statute of Frauds for the following reasons.
First, the Statute of Frauds requires that if the signature has been removed from
the document, falsely affixed to the document, or forged by another party or the contents of the document have been altered, that
this fraud must be capable of being easily established. The Uniform Electronic Transactions Act does not seem to require this in s 2(8).
- Secondly, the Statute of Frauds also requires the signature to be capable of identifying the person who has affixed the signature,
but the Uniform Electronic Transactions Act does not expressly provide for this, unless the phrase "executed or adopted by a person" can be read to mean that the signature must
also be capable of identifying the person who has affixed it.
- The third potential problem with this definition is that there is no explanation as to what is required for the electronic signature
to be regarded as linked or logically associated with the record. For the purposes of the Statute of Frauds, it is obviously desirable
that any changes in the signature be detectable. The wide meaning of "logically associated" means that a mechanism for detecting
alteration will not necessarily be a feature of a signature meeting the requirements of the section.
- On 13 December 1999, the European Parliament and Council adopted the Directive of the European Parliament and of the Council on a
Community Framework for Electronic Signatures.[59]
Similar to the UNCITRAL Model Law on Electronic Signature, the Electronic Signatures Directive follows a two-tiered approach by "setting
requirements for e-authentication methods with a certain minimum legal power ... and by attributing greater legal effect to certain
widely used techniques."[60]
The first tier of the Electronic Signatures Directive prohibits discrimination between handwritten and electronic signatures. Article
5 requires member States to ensure that an electronic signature[61]
is not denied legal effectiveness and admissibility as evidence in legal proceedings solely on the grounds that it is:
- in electronic form, or
- not based upon a qualified certificate, or
- not based upon a qualified certificate issued by an accredited certification-service-provider, or
- not created by a secure signature-creation device.[62]
- Consequently, the first level of the Electronic Signatures Directive accepts most electronic signatures on a technologically neutral
basis, similar to the UNCITRAL Model Law on Electronic Commerce.
The second tier of the Electronic Signatures Directive accords an
"advanced" electronic signature with the same legal effect as a manuscript signature on a paper document. An advanced electronic
signature must satisfy the following requirements:
- it is uniquely linked to the signatory;
- it is capable of identifying the signatory;
- it is created using means that the signatory can maintain under his sole control; and
- it is linked to the data to which it relates in such a manner that any subsequent change of the data is detectable ... .[63]
- An advanced electronic signature based on a "qualified certificate",[64]
produces a rebuttable presumption that it "(a) [satisfies] the legal requirements of a signature in relation to data in electronic
form in the same manner as a handwritten signature satisfies those requirements in relation to paper-based data; and (b) [is] admissible
as evidence in legal proceedings".[65]
- It is the writers' view that a signature that meets the above requirements for an advanced electronic signature will also satisfy
the functions of a signature as required by the Statute of Frauds. An advanced electronic signature will be required to be capable
of identifying the signatory, indicating the signatory's approval of the contents of the document as well proving the integrity of
the electronic document in the sense that a signature satisfying the requirements of an advanced electronic signature should be capable
of detecting any subsequent alterations to the document since it was signed.
- Similar to the Electronic Transactions (Queensland) Act 2001 (Qld), s 22 of the Electronic Transactions Act 2002 (NZ) makes provision for an electronic signature to fulfil a legal requirement
for a signature.[66]
Section 22 is consistent with s 14 of the Electronic Transactions (Queensland) Act 2001 (Qld) and sets out the same criteria of identity, approval, reliability appropriate to the circumstances and consent. However, the
legislation goes one step further than the Queensland Act by including in s 24 a presumption for when the signature is as reliable
as appropriate for the circumstances.[67]
- These provisions mirror Article 6(3) of the UNCITRAL Model Law on Electronic Signatures, discussed above. The same issues discussed
in that context apply to the New Zealand Act. The criteria listed for the creation of the presumption are consistent with the type
of functionality expected for a signature under the Statute of Frauds, however a party is able to prove the reliability of the signature
in other ways.[68]
One disadvantage to this approach is that a signature which does not fulfil the criteria will not be presumed to be equivalent to
a manuscript signature unless proved otherwise. This may place undue requirements on parties wishing to enter transactions or provide
information where the type of formality required for a land transaction is not necessary.
- In the writers' view the New Zealand framework is compatible with the Statute of Frauds and provides for an electronic signature that
would fulfil the functions of a manuscript signature under that legislation.
- This article refers to a number of model laws, directives and legislation which purport to implement legal frameworks which validate
the use of electronic media and signatures for commercial transactions, including land transactions. In the introduction to this
article, we propounded the view that current Australian legislation purporting to validate electronic transactions provides inadequate
protection to parties entering electronic land transactions. The approach in the Australian legislation, is to mandate the validity
of electronic signatures provided certain criteria are met. These criteria provide a minimum standard to which an electronic signature
must adhere to be valid. However, when viewed in light of the reasons for requiring a signature on a land transaction under the
Statue of Frauds these criteria are clearly inadequate to ensure a party to such a transaction is protected from fraud to the same
extent as under a paper based transaction. It is submitted that the integrity of electronic land transactions can be improved by
the introduction of a two tier concept as used in the
Electronic Signatures Directive or the UNCITRAL Model Law on Electronic Signatures.
- This view is also generally held amongst commentators in the United States. Generic first tier legislation does not address the issue
of authenticity which would be required to satisfy the writing requirement of the Statute of Frauds and which requires more than
the mere act of signing a document. Authentication goes directly to the integrity of the contents of the document which in a paper
based medium is accomplished by each party having a counterpart of the document signed by the other party. This would not occur
where a document remained electronic and was stored in a static format.[69]
Despite majority support for a two tier approach there is disagreement amongst American commentators. Some consider that electronic
transaction legislation, whilst not mandating the use of electronic signatures, otherwise satisfies traditional contract law writing
requirements including those under the Statute of Frauds as long as certain conditions are met under that statute.[70]
Other commentators, however, are far less sanguine about the application of this legislation and consider that something more is
necessary before the mere existence of an electronic signature regardless of how it is generated that is whether it is a true digital
signature created through public key infrastructure or merely a typed name in an email, will satisfy requirements of writing where
these requirements are mandated by Statute of Frauds requirements.[71]
- While the writers' advocate this approach as the next step in Australia it is recognised that there are some difficulties which may
impact on the integrity of electronic signatures under such a regime. Only certain types of electronic signatures namely digital
signatures using PKI or biometric technology will satisfy the definition. A major criticism argued by some commentators,[72]
and endorsed by the writers, is the need for Public Key Infrastructure to be more fully developed including the certification processes.
Government has shown a desire to remain outside of this process leaving commercial enterprises to take up the challenge. For this
to occur on a large scale the operation of this infrastructure must be viewed as a viable business model before there would be investment
in it. It is clear that in other countries such as Germany or Austria which have national electronic signature statutes, only a
small number of private corporations operate Public Key Infrastructure which is required if second tier regulation is to occur.[73]
- Despite the infancy of Public Key Infrastructure in Australia, it is suggested that the two tier concept as used in the Electronic
Signatures Directive or the UNCITRAL Model Law on Electronic Signatures is preferable to the current definition used in the Electronic
Transactions legislation in each State of Australia because it allows for flexibility- the first tier can apply to any type of electronic
signatures. The second tier requires more stringent conditions to be fulfilled and those conditions satisfy the functionalities required
of a signature under the Statute of Frauds. Since the electronic signature provisions in both the Commonwealth and State Electronic
Transactions Acts are based on article 7 of the UNCITRAL Model Law on Electronic Commerce, one option for Australia would be to adopt
the Model Law on Electronic Signatures. The Model Law on Electronic Signatures through article 6 provides standards against which
the technical reliability of electronic signatures may be measured without limiting the availability of the flexible criterion embodied
in article 7 of the Model Law on Electronic Commerce. However, until Public Key Infrastructure is developed in Australia, so that
issues of authentication and security in signature requirements are addressed, the various iterations of the electronic transactions
legislation in Australia, exemplified by the Queensland Electronic Transactions (Qld) Act 2001, provide little assistance in assuring
the integrity of electronic land transactions.
[1]
Refer to Reed C "What is a Signature?" 2000 (3) Journal of Information, Law and Technology located at http://elj.warwick.ac.uk/jilt/00-3/reed.html See also the words of Denning LJ in Goodman v Eban [1954] QBD 550 at 56"In modern English usage when a document is required to be "signed by" someone that means that he must write his name with his
own hand upon it."
[2]
Refer to R v Moore Ex Parte Myers (1884) 10 VLR 322.
[3]
In re Clarke 27 LJPM&A 18 (illiterate testator made his mark on will but wrong name written against the mark - extrinsic evidence admitted to show true identity
of maker of mark); in re Field
Curt 752; Baker v. Dening [1838] EngR 548; 8 A&E 94 (signature valid even though signatory could write his name), In re Doe d. Phillips v. Evans 2 LJ Ex 19
(signature by seal valid for purposes of Insolvency Act); In Re Byrd
Curt 117 (signature by seal invalid for purposes of Wills Act);
Schneider v. Norris [1814] EngR 211; 2 M&S 286.
[4]
[1954] 1 QBD 550 at 557. This case involved a solicitor's bill which had been signed with a facsimile of the firm's name imposed by a rubber stamp.
[5]
[1954] 1 QBD 550 at 563.
[6]
Re a debtor(No 2021 of 1995) [1996] 2 All ER 345 at 349 per Laddie J.
[7]
Goodman v J Eban Ltd [1954] 1 QB 550 at 55 per Lord Evershed MR.
[8]
Standard Bank London LTD v The Bank of Tokyo [1995] 2 Lloyd's Report 169.
[9]
Cohen v Roche [1927] 1 KB 16 at 176 per McCardie J.
[10]
Farrelly v Hircock (No 1) [1971] QdR 341 at 356 per Wanstall J (as he then was).
[11]
Williams J, The Statute of Frauds, Section 4 - In the Light of Its Judicial Interpretation, supra at 87-88.
[12]
Similar provisions exist in other States of Australia: [insert comparative provisions]
[13]
Tiverton Estates Ltd v Wearwell Ltd [1975] 1 Ch 146.
[14]
Leeman v Stocks [1951] 1 Ch 941 at 947-948.
[15]
For further discussion of the characteristics of a signature refer to McCullagh A, Caelli W, Little P, "Signature Stripping:
A Digital Dilemma" 2001 (1) Journal of Information, Law and Technology http://elj.warwick.ac.uk/jilt/01-1/mccullagh.html
[16]
[1987] 1 Lloyd's Rep 546.
[17]
Ibid at 554.
[18]
That is placing a scanned signature or typing a name on a document.
[19]
There are several different technologies used to create digital signatures. See A McCullagh, "Legal Aspects of Electronic
Contracts and Digital Signatures" in Going Digital 2000: legal issues for e-commerce, software and the internet, Fitzgerald A, Fitzgerald
B, Cifuentes C, Cook P (ed), St. Leonards, NSW, Prospect Media, 2000 at 195.
[20]
The message summary may be referred to by a variety of names including "hash value", "message digest", "cryptographic check"
or even a "seal".
[21]
See Faber D, Digital Signature Guidelines, Judicial Studies Board, July 2000.
[22]
This issue is discussed below.
[23]
Ibid.
[24]
McCullagh A, Caelli W, Little P, "Signature Stripping: A Digital Dilemma" 2001 (1) Journal of Information, Law and Technology
http://elj.warwick.ac.uk/jilt/01-1/mccullagh.html
[25]
McCullagh A, Caelli W, Little P, "Signature Stripping: A Digital Dilemma" 2001 (1) Journal of Information, Law and Technology
http://elj.warwick.ac.uk/jilt/01-1/mccullagh.html
[26]
The Certification Authority will need to be a trusted third party that has established appropriate security procedures for
the identification of parties applying for keys, maintaining the currency of the certificates given and maintaining security in the
creation of private and public keys.
In Australia, the government has rejected the establishment of government regulated Certification
Authorities. The government has proposed the establishment of the National Electronic Authentication Council (NEAC) to develop appropriate
policies that the certification industry in Australia will be required to meet.
[27]
See L'Estrange v Graucob [1934] 2 KB 394, Saunders v Anglia Building Society [1970] UKHL 5; [1971] AC 1004.
[28]
This view is consistent with the Electronic Transactions legislation, which provides for an electronic communication sent by
a party to be attributed to that party only if it was sent with that party's authority. Refer to s 26 Electronic Transactions (Queensland) Act 2001 (Qld).
[29]
McCullagh A, Caelli W, Little P, "Signature Stripping: A Digital Dilemma" 2001 (1) Journal of Information, Law and Technology
http://elj.warwick.ac.uk/jilt/01-1/mccullagh.html
[30]
McCullagh A, Caelli W, Little P, "Signature Stripping: A Digital Dilemma" 2001 (1) Journal of Information, Law and Technology
http://elj.warwick.ac.uk/jilt/01-1/mccullagh.html
[31]
The text of the Model Law on Electronic Signatures can be found on the UNCITRAL website at http://www.uncitral.org/english/texts/electcom/ml-elecsig-e.pdf
[32]
Information on the status of texts can be found on the UNCITRAL website http://www.uncitral.org/en-index.htm
[33]
The term "electronic signature" is defined in Article 2 as "data in electronic form in, affixed to or logically associated
with, a data message, which may be used to identify the signatory in relation to the data message and to indicate the signatory's
approval of the information contained in the data message".
[34]
The Electronic Signatures Directive, discussed below, has a similar requirement, the difference being that the UNCITRAL Model
Law on Electronic Signatures requires the signature creation data to be linked to the signatory, whereas the Directive requires the
electronic signature to be linked to the signatory.
[35]
The term signatory is defined as a person that holds signature creation data and acts either on its own behalf or on behalf
of the person it represents: Article 2(d) Model Law on Electronic Signatures.
[36]
An example of such a situation would be where several employees share the use of a corporate signature creation data. In such
a situation, the signature creation data must be capable of identifying one user unambiguously in the context of each electronic
signature.
[37]
In the context of electronic signatures which are not digital signatures, the term "signature creation data" is intended to
designate those secret keys, codes or other elements which, in the process of creating an electronic signature, are used to provide
a secure link between the resulting electronic signature and the person of the signatory. An example is provided: in the context
of electronic signatures based on biometric devices, the essential element would be the biometric indicator, such as a fingerprint
or retina-scan data.
In the context of digital signatures relying on asymmetric cryptography, the core operative element that could
be described as "linked to the signatory" is the cryptographic key pair (the private and public keys). However, only the private
key is covered by this description of "signature creation data". The text being electronically signed is also not covered by this
description: UNCITRAL Guide to Enactment to the Model Law on Electronic Signatures 2001, para. 97.
[38]
This is similar to the Electronic Signatures Directive. However, the UNCITRAL Model Law on Electronic Signatures requires the
signature creation data to be under the signatory's sole control, whereas the Electronic Signatures Directive refers to the method
used to create the electronic signature to which the signatory must maintain under his or her sole control.
[39]
UNCITRAL Guide to Enactment on the Model Law on Electronic Signatures 2001, para. 126.
[40]
The Electronic Signatures Directive requires that the electronic signature (to qualify as an advanced electronic signature)
be capable of identifying the signatory. This requirement is not set out in the UNCITRAL Model Law on Electronic Signatures but is
contained within the Model Law's definition of an electronic signature.
[41]
Article 6(4): "Paragraph 3 does not limit the ability of any person: (a) To establish in any other way, for the purpose of
satisfying the requirement referred to in paragraph 1, the reliability of an electronic signature"
[42]
UNCITRAL Guide to Enactment on the Model Law on Electronic Signatures 2001, para. 128.
[43]
Similar provisions apply in other Australian jurisdictions: Imperial Acts (Substituted Provisions) Act 1986 (ACT), Sch 2 Pt 11 cl 4; Conveyancing Act 1919 (NSW), s 54A; Law of Property Act 2000 (NT), s 62; Law of Property Act 1936 (SA), s 26(1); Conveyancing Law of Property Act 1884 (Tas), s 9; Instruments Act 1958 (Vic), s 136; Statute of Frauds 1677 (Imp) (WA), s 4.
[44]
Note that the signature provision of the UNCITRAL Model Law on Electronic Commerce (Article 7) specifically provides that its
signature provision applies whether the requirement (where the law requires the signature of a person) is in the form of an obligation
or whether the law simply provides consequences for the absence of a signature.
[45]
See Sneddon M, "Legislation to facilitate electronic signatures and records: Exceptions, standards and the impact of the Statute
Book" (1998) University of New South Wales Law Journal 334, 360.
[46]
See section 10(1)(a) Electronic Transactions Act 1999 (Cth)
[47]
Explanatory memorandum to the Commonwealth Electronic Transactions Act at p.31, it also recognises that some signature technologies such as digital signatures will also verify the integrity of the electronic
communication, simply by the nature of the way they operate.
[48]
Explanatory memorandum to the Commonwealth Electronic Transactions Act at p.32.
[49]
See Explanatory Memorandum to the Commonwealth Electronic Transactions Act at p.31.
[50]
See Explanatory Memorandum to the Commonwealth Electronic Transactions Act at p.31. An example is provided: a signature method may be applied to a communication but then transmitted as a packet of information
separate to the communication. If the signature can be shown to indicate the person's approval of the information contained in the
communication then the signature will satisfy the requirements in paragraph (a).
[51]
A good example would be the UNCITRAL Model Law on Electronic Signatures or the Electronic Signatures Directive, both in this
article.
[52]
See http://www.bmck.com/uetacomp.htm for a list of states which have enacted the Uniform Electronic Transactions Act.
[53]
Uniform Electronic Transactions Act 1999 (US) section 2(8): "Electronic signature" means an electronic sound, symbol, or process attached to or logically associated with a record and executed
or adopted by a person with the intent to sign the record.
[54]
The Uniform Electronic Transactions Act does not say how this intention can be shown. The commentary to the Uniform Electronic Transactions Act simply states that the critical element is the intent to sign: "One may use a digital signature with the requisite intention, or
one may use the private key solely as an access device with no intention to sign, or otherwise accomplish a legally binding act.
In any case the critical element is the intention to execute or adopt the sound or symbol or process for the purpose of signing the
related record": Uniform Electronic Transactions Act 1999 (US) comments to section 2, comment 7. The Uniform Electronic Transactions Act does describe attribution procedures which are used to verify that an electronic signature, message, or record is that of the person
purporting to provide it: see s 9(a) of the Uniform Electronic Transactions Act.
[55]
Manual signatures appear on the writing itself so are associated with the writing.
[56]
See Uniform Electronic Transactions Act 1999 (US) comments to section 2, comment 7: "This definition includes as an electronic signature the standard webpage click through process. For example, when a
person orders goods or services through a vendor's website, the person will be required to provide information as part of a process
which will result in receipt of the goods or services. When the customer ultimately gets to the last step and clicks "I agree," the
person has adopted the process and has done so with the intent to associate the person with the record of that process".
[57]
Fry P, "Introduction to the Uniform Electronic Transactions Act: Principles, Policies and Provisions" (2001) 37 Idaho Law Review 237, 257; also see commentary: for example, when a person orders goods or services through a vendor's website, the person will be required
to provide information as part of a process which will result in receipt of the goods or services. When the customer ultimately gets
to the last step and clicks "I agree," the person has adopted the process and has done so with the intent to associate the person
with the record of that process: Uniform Electronic Transactions Act 1999 (US) comments to section 2, comment 7.
[58]
Uniform Electronic Transactions Act 1999 (US) comments to section 2, comment 7.
[59]
Directive of the European Parliament and of the Council on a Community Framework for Electronic Signatures, European Parliament
Document (1999/93/EC) (1999), OJ 2000 L13/12, [hereinafter Electronic Signatures Directive]. Date for compliance: 19 July 2001. In the United Kingdom, the Electronic Signatures
Directive has been implemented by the Electronic Signatures Regulations 2002 and section 7 of the Electronic Communications Act 2000. The provisions of the Directive which are implemented by the Electronic Signatures Regulations relate to the supervision of certification-service-providers,
their liability in certain circumstances and data protection requirements concerning them. Provisions in the Directive relating to
the admissibility of electronic signatures as evidence in legal proceedings were implemented by section 7 of the Electronic Communications Act 2000.
[60]
Spyrelli, C, "Electronic Signatures: A Transatlantic Bridge? An EU and US Legal Approach Towards Electronic Authentication"
Journal of Information, Law and Technology 2002(2) http://elj.warwick.ac.uk/jilt/02-2/spyrelli.html .
[61]
Electronic signature is defined in Article 2 as "data in electronic form which are attached to or logically associated with
other electronic data and which serve as a method of authentication".
[62]
Electronic Signatures Directive, article 5.
[63]
Electronic Signatures Directive, article 2(2).
[64]
A qualified certificate' means a certificate which meets the requirements laid down in Annex I and is provided by a certification-service-provider
who fulfils the requirements laid down in Annex II: see Article 2(10). A "certificate" is an "electronic attestation which links
signature-verification data to a person and confirms the identity of that person": see Article 2(9).
[65]
Electronic Signatures Directive, article 5(1).
[66]
S 22 provides: (1) Subject to subsection (2), a legal requirement for a signature other than a witness' signature is met by means of an
electronic signature if the electronic signature
a. adequately identifies the signatory and adequately indicates the signatory's
approval of the information to which the signature relates; and
b. is as reliable as is appropriate given the purpose for which,
and the circumstance sin which, the signature is required.
(2) A legal requirement for a signature that relates to information legally
requirement to be given to a person is met by means of an electronic signature only if that person consents to receiving the electronic
signature.
[67]
Section 24 provides: (1) For the purposes of sections 22 and 23, it is presumed that an electronic signature is as reliable as is appropriate if---
(a) the means of creating the electronic signature is linked to the signatory and to no other person; and
(b) the means of creating
the electronic signature was under the control of the signatory and of no other person; and
(c) any alteration to the electronic
signature made after the time of signing is detectable; and
(d) where the purpose of the legal requirement for a signature is to
provide assurance as to the integrity of the information to which it relates, any alteration made to that information after the time
of signing is detectable.
(2) Subsection (1) does not prevent any person from proving on other grounds or by other means that an electronic signature---
(a)
is as reliable as is appropriate; or
(b) is not as reliable as is appropriate
[68]
See s 24(2).
[69]
Hartley J, Électronic Signature and Electronic Records in Cyber-Contracting" (2003) 49 The Practical Lawyer 1 at 5.
[70]
For example, Berenstein G and Campbell C, "Electronic Contracting: The Current State of the Law and Best Practices" (2002)
14 Intellectual Property & Technology Law Journal 1 at 4.
[71]
Huey N, "E-mail and Iowa's Statute of Frauds: Do E-sign and UETA Really Matter? (2003) 88 Iowa Law Review 681 at 690; Broderick M, Gibson V and Tarasevich P, "Electronic Signatures: There Legal Now What?" (2001) 11 Internet Research: Electronic
Networking Applications and Policy 423 - 434.
[72]
Bell J, Gomez R, Hodge P and Mayer-Schonberger V, "Electronic Signature Regulation - An Early Score Card - Comparing Electronic
Signatures Legislation in the US and the European Union" (2001) 17 Computer Law & Security Report 399.
[73]
Ibid at 402.
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