Authenticating Electronic Agreements and Signatures

By Stephen C. Gerrish, Senior Counsel

A new California Court of Appeal decision, Espejo v. Southern California Permanente Medical Group, elaborates on how to prove that documents signed online, digitally, are authentic, and therefore have the same effect as a handwritten signature.

California statutes mandate that an electronic signature has the same legal effect as a handwritten signature, but the document still must be proven as authentic before it is evidence. This statute states only that it is authentic if it is the “act of the person,” which can be shown through the “efficacy of any security procedure” used to determine the person to which the signature is attributable. This does not provide much practical guidance on how to show that “efficacy.”

The Court of Appeal explained that the proponent of the document must show how, or on what basis, it can be inferred that the electronic signature is the “act of the person.” The critical factual connection between the signature and the act of that person must be established. This is accomplished by detailed proof of (i) the security and privacy precautions used to protect the transmitted link to the document and the accompanying user id and password provided to the person, (ii) the steps that the person must take to place her name on the document, (iii) the procedures that insure that the name on the signature line could only have been placed by a person using the unique id and password, and (iv) that therefore the signature was made by the person intended.

In the Espejo case, the employer proved that it had a procedure in place that assured that the electronic signature was, in fact, the “act of” the intended employee. To establish the authenticity of the alleged agreement, this detailed, step by step process, must be followed and explained. If an agreement’s authenticity, and binding effect, is challenged, courts will require detailed proof of the procedures that insured that the signature was placed by the person whose electronic signature appears on the document.