Electronic signatures in practice.

• Author: Mason, Stephen

Senior Research Fellow and Director of the Digital Evidence Research Programmeat the British Institute of International and Comparative Law; General Editor, Digital Evidence Journal; Associate Senior Research Fellow, Institute of Advanced Legal Studies

This article briefly outlines the case law in relation to manuscript signatures in England and Wales, putting the concept of manuscript signatures into historical perspective from the point of view of the common law. A short outline of the international framework for electronic signatures will follow, and consideration will be given to the three main concepts adopted by politicians in the form of legislation from across the world. The forms of electronic will be set out, and a number of practical and evidential issues will be taken into account. Relevant case law is considered throughout the article.

Introduction

Before the use of electronic signatures, successive judges in England and Wales, as well as other common law countries, took the view that the form a manuscript signature takes is not relevant, providing the function the signature performs is clear from the evidence. This pragmatic view of the imperfections of human behaviour has enabled judges to widen the concept of a signature, as set out briefly in the discussion below.

Manuscript signatures in England and Wales

The mark of a cross is an accepted form of signature, as demonstrated by the case of Harrison v Harrison. (1) In addition, the use of a pseudonym has been held acceptable, (2) as has the use of initials, since the 1808 case of Phillimore v Barry. (3) The decision by Matheson J in Re Schultz (4) serves to reinforce the point that the difference in time or jurisdiction does not alter the underlying rationale of this line of thinking. Similar examples demonstrate the inherent flexibility of this approach, in that a surname has been held sufficient to authenticate a document, (5) as has a trade name, (6) a partial signature, (7) words other than a name, (8) an identifying phrase (9) and an abbreviation of a name. (10)

Impression of a mark

Seals have a long history, and name seals remain in common use in Japan. There are two forms in Japan: the Jitsuin (official or legal seal) and mitomein (personal seals). Any type of name seal can serve as a mitomein, but a Jitsuin must be registered. Jitsuins are used instead of manuscript signatures to execute important documents. The first recorded case relating to the use of a seal in England and Wales dates from 1681. (11) In this instance, the devisor added his seal to his will in front of the three witnesses, but did not add his manuscript signature. In a somewhat ambiguous decision, it was held, with Levinz, J. dissenting, that the act of using the seal was a sufficient mark. This decision was not acceptable to some judges, and by 1754, (12) it was established that the use of a seal was not capable of authenticating a document. However, a number of nineteenth century cases subsequently accepted the possibility that a seal was capable of acting as a means of authentication. (13) Further examples of impressions that have been held acceptable as authenticating a document include the use of a printed name (14) and a stamp. (15)

Mechanical marks by human action

Modern technology has never been an obstacle to judges in applying underlying legal principles, as demonstrated by the use of a telex to enter a contract, which was the subject of discussion in the case of Clipper Maritime Ltd v Shirlstar Container Transport Ltd, The Anemone, (16) and the transmission of a proxy form by way of a facsimile transmission, which was considered in 1995. (17)

Electronic signature legislation

Several international organizations produced guidelines in relation to the manifestation of electronic signatures at the turn of the centuries. These include two United Nations Commission on International Trade Law (UNCITRAL) Model Laws, on Electronic Commerce (18) and Electronic Signatures. (19) The International Chamber of Commerce (ICC) produced a further document entitled 'General Usage for International Digitally Ensured Commerce' (GUIDEC). (20) The UNCITRAL model laws are designed to encourage harmonization of laws across member states, and the ICC document seeks to allocate risk and liability between parties that are in line with current business practices.

Approaches to legislation Functional equivalent concept

In many civil law jurisdictions, the digital signature is considered to have a greater legal effect than other forms of electronic signature. For instance, many of the states in Latin America have developed laws based on the UNCITRAL Model Law on Electronic Signatures and the European Union (EU) Directive. Although there is an emphasis on the digital signature as the functional equivalent of a manuscript signature, the legislation also permits the use of other forms of electronic signature, which suggests a two-tier approach as discussed below. One example is the Ley De Firma Digital (21) No 25.506 passed by Argentina in 2001, which provides for the functional equivalent of a manuscript signature in article 3, in that a digital signature is considered to be the equivalent of a manuscript signature:

"ARTICULO 3.--Del requerimiento de firma. Cuando la ley requiera una firma manuscrita, esa exigencia tambien queda satisfecha por una firma digital. Este principio es aplicable a los casos en que la ley establece la obligacion de firmar o prescribe consecuencias para su ausencia." (22)

"ARTICLE 3.--On the requirement of signature. When the law requires a handwritten signature, this requirement is also met by a digital signature. This principle is applicable to those cases in which the law establishes the obligation of signing or prescribes consequences for the absence of a signature."

Where a digital signature is used, the legislation requires it to be verified by a third party by way of the Application Authority, and the verification serves not only to identify the signing party, but is required to detect any alteration to the document after it has been signed. In addition, there is a requirement that the digital signature be controlled by the signing party and be under their absolute control, as provided for in article 2:

"ARTICULO 2.--Firma Digital. Se entiende por firma digital al resultado de aplicar a un documento digital un procedimiento matematico que requiere informacion de exclusivo conocimiento del firmante, encontrandose esta bajo su absoluto control. La firma digital debe ser susceptible de verificacion por terceras partes, tal que dicha verificacion simultaneamente permita identificar al firmante y detectar cualquier alteracion del documento digital posterior a su firma.

Los procedimientos de firma y verificacion a ser utilizados para tales fines seran los determinados por la Autoridad de Aplicacion en consonancia con estandares tecnologicos internacionales vigentes." (23)

"ARTICLE 2.--Digital Signature. A digital signature is the result of applying a mathematical procedure to a digital document, that requires information controlled exclusively by the signing party and which is under his absolute control. The digital signature must be verifiable by third parties, such that this verification will simultaneously permit the identification of the signing party and detect any alteration of the digital document after it has been signed.

The signature and verification procedures to be used for this purpose shall be those established by the Application Authority in accordance with current international technological standards."

Other forms of electronic signature are not recognized as the functional equivalent of a manuscript signature unless the parties mutually recognize the form of signature that is used. If a party relies on any other form of electronic signature, it is for them to prove its validity, as provided for in article 5:

"ARTICULO 5.--Firma electronica. Se entiende por firma electronica al conjunto de datos electronicos integrados, ligados o asociados de manera logica a otros datos electronicos, utilizado por el signatario como su medio de identificacion, que carezca de alguno de los requisitos legales para ser considerada firma digital. En caso de ser desconocida la firma electronica corresponde a quien la invoca acreditar su validez."

"ARTICLE 5.--Electronic signature. An electronic signature is a set of integrated electronic data, linked or associated logically to other electronic data, used by the signing party as his means of identification, which lacks any of the necessary requirements to be considered a digital signature. If an electronic signature is not recognized, it is up to the party that invokes it to prove its validity."

The minimalist approach

Australia, (24) Canada, (25) Guernsey, (26) and the United States of America (27) have adopted this approach. To a certain extent, this is the approach taken in the United Kingdom with the Electronic Communications Act 2000. In common law countries, the emphasis on form, rather than function, means the weight of the evidence is far more important in determining a person's intention, rather than the form that their signature took. (28) The Australian government deals with the legal effect of electronic signatures, which are reflected in the provisions of [section] 10 of the Electronic Transactions Act (29):

"10 Signature

Requirement for signature

If, under a law of the Commonwealth, the signature of a person is required, that requirement is taken to have been met in relation to an electronic communication if:

(a) in all cases-a method is used to identify the person and to indicate the person's approval of the information communicated; and

(b) in all cases-having regard to all the relevant circumstances at the time the method was used, the method was as reliable as was appropriate for the purposes for which the information was communicated; and

(c) if the signature is required to be given...