E-signatures in California: The Current State of Remote Signing

When email, online faxing, and scanned documents became a reality with the onset of the Internet, the question of whether electronic signatures and facsimile signatures were binding on parties as "original" signatures on the real document. Slowly, statutes and case law have caught up with technology, and recent legislation in California has been signed to close some prior loopholes.

The Uniform Electronic Transactions Act and ESIGN

In 1999, the states variously adopted the Uniform Electronic Transactions Act (UETA), followed in 2000 by the Federal ESIGN Act, which recognized only certain types of "digital signatures" as authentic. California's version of UETA excluded certain types of transactions from coverage to protect consumers when not everyone had access to computers or the Internet. Some of those exclusions included various insurance contracts, landlord-tenant eviction notices, and healthcare benefit notices. The intention was that, over time, those exclusions would be removed by statute or case law as they arose.
One of the requirements of UETA, still in place and supported by case law, is that before an electronic signature can be granted legal effect, all parties must agree to be bound by electronic signatures. Recent legislation has amended this provision, and online applications have made the requirement less difficult for the parties.

AB-1065: Amending the Insurance Code

In 2019, Governor Gavin Newsom signed AB-1065, updating both UETA and the California Insurance Code, and removed all sunset provisions on e-signatures for insurance documents, ranging from property and casualty insurance, cancellations of policies, life insurance policies, and so on. The bill also allows the e-signature to be kept as part of the record.

AB-596: Repairing the Automotive Recall Notice

In 2019, Governor Newsom signed AB-596, allowing e-signatures to be used on automotive repair and recall notices. Though less sweeping than AB-1065, this bill provides convenience to the consumer by enabling electronic signatures to be used to authorize repairs on automotive recalls. Previously, such repairs would require the owner to make repeated trips to the repair shop to allow each estimate and repair. The ability to email or fax a signature is a huge step forward for the car owner.

Legitimacy for DocuSign

The online app DocuSign has been a boon to companies around the world, providing a central locus for document management and signature collection. Two cases decided this year (2020) held that DocuSign's management of the parties' documents was sufficient to establish the parties' signatures and agency in the cases.

In Designs for Health, Inc. v. Miller, 201 A. 3d 1125 (Conn. Appellate Ct. 2019), the appellate court held that DocuSign's certificate of completion showing the date and time the parties' had signed a contract with a forum selection clause, met the prima facie evidence requirement that the defendant had signed the document on the date and time stated and could not now claim lack of personal jurisdiction by the court.

In Loretta-Azuka v. Exeter Health Resources, Inc. (2019 DNH 87), the plaintiff attempted to claim that her signature on a "Placement Order" had been forged adequately overcome by DocuSign's record of the plaintiff's DocuSign account.
As more and more companies rely upon the DocuSign app, cases like this will become more common, and the DocuSign audit trail will become a routine part of discovery for legal teams. In the interest of all parties to agree upon DocuSign as the intermediary for their documents and signatures before utilizing this third party, they should immortalize their agreement in writing before doing so.
As always, anyone in doubt as to the requirements should consult a legal professional. Electronic requirements are still in flux, and the pro in the field is the one who has the most up-to-date information.

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