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For most types of documents an electronic contract and signature is as legally binding as any paper contract that was signed with a pen. These documents fall under the protection of the Electronic Signatures in Global and International Commerce Act (ESGICA).

What Is an Electronic Contract?

An electronic contract is a written agreement between parties that is presented through software being installed in your computer or transmitted by means of the Internet, whether it is:

  • Presented on a webpage;
  • Sent through e-mail; or
  • Downloaded along with a software program.

What Is an Electronic Signature?

An electronic signature is any means of showing by use of computer that you have accepted the terms and conditions of the contract. One common method of electronic signature is when, at the end of contract, you click a button that says "I Accept". By clicking the "I Accept" button, you have just done the legal equivalent of signing your name at the bottom of a paper contract.

What Kind of Documents Are Not Protected by ESGICA?

There are several kinds of documents whose electronic versions are not legally enforceable contracts under the ESGICA:

  • Most types of documents dealing with family matters such as wills, divorce and adoption documents
  • Most kind of notices dealing with the consequences of late or nonpayment or the termination of an agreement (e.g., repossession, termination of utilities, eviction, end of insurance coverage, etc.)
  • Court documents
  • Product recall notices
  • Notices that have to be sent with hazardous material

Can I Choose to Sign a Paper Contract Rather than Using an Electronic Contract?

The ESGICA not only allows you to use a paper contract and paper notices, but says that any company you are dealing with that uses electronic contracts must also tell you that you have the option to opt out of electronic contracts and notices and instead use only paper documents. Even if you have been signing and sending documents by electronic means for a while, you may opt out at any time and request paper contracts and notices.

Can I Be Charged for Using Paper Documents instead of Electronic Documents When the Party I Am Dealing with Primarily Works in Electronic Documents?

Utilizing non-electronic documents is not always free. The other party can subject you to certain charges (sometimes minor fines) for the cost of making and sending paper documents and generally operating in this less efficient manner. The terms of this alternative should always be stated in the terms and condition of the electronic contract.

What Should I Do if I Do Not Understand the Terms and Conditions of an Electronic Contract or Have a Dispute Over the Meaning of the Terms?

Just like dealing with a paper contract, you probably will want to consult an experienced contract attorney. An attorney familiar with electronic contracts will be able to help you interpret the contract and recommend further action to take in resolving any dispute.

Photo of page author Ken LaMance

, LegalMatch Law Library Managing Editor and Attorney at Law

Last Modified: 08-07-2012 03:23 PM PDT

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