This entry was co-authored by Thomas Schober & Jackie Messler:
Have you ever wondered, "Is my electronic signature binding?" As law catches up to technology, we are finally getting an answer to this question.
As a result of new laws, more and more can be accomplished electronically. Both federal and Wisconsin laws provide for the validity of documents and transactions completed electronically. The federal law, E-SIGN, provides that a signature, contract, or other record relating to a transaction may not be denied legal effect, validity, or enforceability solely because it is electronic. 15 U.S.C. § 7001. The Wisconsin law, E-Commerce, provides that a record, signature, or contract may not be denied legal effect or enforceability solely because it is in electronic form. Wis. Stat. § 137.15.
With the increased ability to complete transactions electronically comes increased concern about the genuineness of the documents and signatures. Lawmakers were also concerned with providing protection to consumers. According to the federal law, when an electronic transaction involves a “consumer,” three requirements must be met:
- the consumer must be provided with information about the electronic format,
- the consumer must consent to the electronic format, and
- the consumer’s consent must be completed electronically.
“Consumers” are those who obtain products or services primarily for personal, family, or household purposes. 15 U.S.C. § 7006. However, there is no additional consent requirement for any transaction that is strictly commercial or between two businesses.
What ramifications do these laws have for Wisconsin businesses? As many more transactions will be able to completed electronically, businesses and persons involved in transactions should be cautious to complete the proper consent requirements with consumers. For example, with the proper consent, buyers and sellers may complete the Wisconsin Form WB-11, Residential Offer to Purchase, electronically.
Knowledgable attorneys will seek to use electronic signatures to speed up transactions and save their clients money.