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The History (and Future) of Electronic Signatures

By:
Matthew Hemmert
Sep 29, 2021

It wasn’t long ago that executives were using ink and a rubber stamp to “sign” documents. In an effort to speed the process of signing, they would entrust their stamp to another “authorized user” who could stamp or “sign” documents on their behalf. The premise was that if the person had physical access to the stamp pad, then they must be an approved user and have the authority to sign agreements or other legal documents.

The Questionable Signature

Fast forward to the even more not-so-distant past and you will find electronic documents that were “signed” when someone added a signature image to the document. Anyone can drop a JPEG onto a contract, although the assumption is that if they have access to the signature file, then they must be authorized to sign on the individual’s behalf. This is where the process breaks down. With signature images such as these, there is no quick and easy way to verify that the individual or someone they authorized was the actual signor of a document. No audit trail or metadata exists to prove whether it was an approved, authorized signature and not a fake.

The troubling part is, we continue to see these short cuts in the signature process all the time. As lawyers, it is our responsibility to make a reasonable argument to a court about why we believe a signature is valid. You may find yourself making logical arguments such as, it came from the correct email address or domain, it was the correct draft, or it included what appeared to be a valid written signature. Electronic signature images on electronic documents make it harder to validate that it was the person who affixed it themselves or someone authorized to do so on their behalf. Don’t get me started on how many people have tried to get out of a contract claiming the person who affixed the signature didn’t have authority – mind you, after a year of beneficially using the software.

Digital signatures are another type of electronic signature; however, they are like having a fingerprint on the document. They are tied to a certificate that always includes an audit trail which means that at any point, you can see when it was sent, who received it, what time, etc. Additionally, the signature itself is time and date stamped automatically. This digital trail gives you something to follow and provide proof that the signor was who they said they were. This trail is so clear in fact that digital signatures are rarely contested. Indeed, they are accepted in most courts thanks to the clear chain of custody from sending to signing. As they say in many (very small) circles, it is as good as being signed, sealed, and stamped.

6 Essential Reasons to Have A Digital Signature Fingerprint On Your Side

What makes a digital signature service an absolute requirement for any legal professional or law firm? As you know, inclusive of contracts, any transactional document that needs a signature must withstand scrutiny in court. Everything from real estate transactions and acquisitions, to wills and trusts, estate directives, etc. must include an authorized signature that can be certified or validated in the court of law.

Here are 6 reasons why a law firm or legal professional wants to use electronic signature (or e-signature) services that follow the digital signature guidelines:

  1. Peace of mind knowing people cannot alter, duplicate, or do anything untoward, with a document that has been sent through an electronic service vendor that utilizes digital signature protocols. Because documents uploaded to an electronic signature service with digital signatures are protected from alteration, users are restricted from altering or copying the text directly and cannot export or change the document contents or import/upload a new version. They may only review and sign (or refuse to sign). This means the security of the document, and veracity of the content, are not in question.
  2. Signatures can be verified with an audit trail. Most electronic signature vendors with digital signature protocols provide certifications and audit trials for documents that are processed through their systems. Certificates can be issued against those signatures and are accepted and defensible in most jurisdictions. It’s like having a having a public notary without actually needing a public notary.

    DISCLAIMER: Anything that needs an actual public notary cannot go through a digital service vendor.
  3. Time and cost needed for closing an agreement is greatly reduced. There is no longer a need to overnight documents back and forth between signatories unless working on documents that need to be notarized or go through the apostille process. No in-person interaction is required. In fact, you can now close a deal from across the country in about 30 seconds. This speed to close reduces both hard costs (printing and shipping) and soft costs (scanning and uploading). Automated workflow, as well as knowing the document is retained once signatures are all there, increases the savings.
  4. Security of knowing that document, once it's fully signed, is secure. Fully executed documents need to be stored electronically within a system like NetDocuments. It provides peace of mind knowing that you’re not going to lose it somewhere and that it remains searchable within the system.

    By combining a solution like DocuSign eSignature with the power of NetDocuments, you automate the process and reduce your risk. No longer are you reliant on someone scanning in physical documents or storing attachments from within the email system where mistakes happen or people forget to finish their uploads. Using the built-in integration with DocuSign eSignature means that documents are automatically stored, tracked, and certified.
  5. Electronic signatures with digital signature fingerprints are intuitive, convenient, and can be completed almost anywhere in the world, from practically any device. We’re all looking for ways to increase efficiency and productivity. So why create a process that is hard for you or your clients? DocuSign eSignature is safe and easy, saving both time and money. It also eliminates the premise of an unavailable client/signatory. Whether they are sitting in their car, on their phone, on a laptop from home or work, or in a cabin on vacation, signing can take place in less than 30 seconds. Waiting until someone is back in the office is no longer a valid excuse.
  6. As stated previously, digital signature validation is easier to defend in court. Courts are treating electronic signatures with digital certification the same way they have treated wet signatures in the past. When you have a time and date stamp with a signature along with a clear electronic chain of custody, it’s difficult to challenge. The audit trail, time/date stamp, and certification process replaces handwriting analysis or a signatory affirming the veracity of physical signatures.

Modern legal transactions demand the convenient and compliant nature of today’s e-signature tools. But with new tools comes new tasks to ensure documents end up in the right place—which can reduce your overall pace.

NetDocuments’ Integration with DocuSign eSignature

The fact is, you don’t have time to waste on new tools that can reduce your speed to delivery. At NetDocuments we are focused on removing the burdensome tasks associated with legal document creation and management; and our new electronic signature integration with DocuSign eSignature is the latest addition in that effort and combines the convenience of signing almost anywhere at any time with the security of a digital fingerprint.

With this integration, users can select documents from NetDocuments and automatically send them to eSignature with a single click.

Once a document is selected, the user can select recipients, who will then receive an email generated by eSignature.

This email will allow the recipients to easily review or sign the selected document. Once the document is signed, the executed PDF is automatically uploaded into NetDocuments and the original file is linked to the executed document in order to maintain a clear paper trail.

How to Get the Most Out of Your E-Signature Tool

Lawyers everywhere are burning out and clients are less likely to pay for time spent on administrative tasks. While an e-signature tool may relieve the time burdens associated with the printing, scanning, sending, signing and tracking of traditional signatures, downloading and transferring prepared or signed documents between your systems can still add steps and clicks to an already packed process.

But as my colleague explains, the right legal technology can certainly relieve these extra steps when implemented correctly.

It stands to reason then that the key to a trusted and powerful e-signature tool truly unlocking productivity for your team is its ability to integrate with your document storage system, such as NetDocuments. The ability to have signed and tracked copies of a document automatically stored within your system of record will be vital to your team’s ability to remain focused on critical tasks—not the everyday administrative ones. Only then will gathering signatures become a clean, secure process that your team can count on every time.

To learn about the NetDocuments integration with DocuSign eSignature and how it can help you get the most out of your e-signature solution, download the product brochure or schedule a demo today.