Michigan Appellate Court Affirms Validity of Electronic Signature Under UETA Reply

E-Commerce News provided by BuckleySandler LLP for informational purposes only, and should not be construed as legal advice on any subject matter.

August 11, 2012

Recently, the Michigan Court of Appeals affirmed summary judgment in favor of a defendant insurance company seeking to dispose of a challenge to an electronic signature executed by a policyholder. Zulkiewski v. Am. Gen. Life Ins. Co., No. 299025, 2012 WL 2126068 (Mich. Ct. App. Jun. 12, 2012). In this case, shortly before a life insurance policy holder died, the beneficiary information on his policy was changed through the insurance company’s online account management service. The former beneficiaries challenged the new beneficiary designation, arguing that although the Uniform Electronic Transactions Act (UETA) permits an electronic signature, to validate the authenticity of such a signature the insurance company must prove the efficacy of its security procedures. On appeal, the court held that the trial court did not err when it relied on evidence provided by the insurance company showing the extent of the personal information required to change the beneficiary, combined with an affidavit that the new beneficiary did not change the beneficiary designation. The court further explained that the appellants misread the relevant portions of the UETA when they argued that the lower court improperly accepted the insurance company’s assertions that its security procedures were “adequate to prevent deception by an imposter.” The court explained that the insurance company need not prove the efficacy of its online security procedures to authenticate a customer’s signature since under the UETA doing so is merely one method by which to show attribution.

Tennessee Supreme Court Relies on UETA to Uphold Contract Formed by E-Mail Signatures Reply

E-Commerce News provided by BuckleySandler LLP for informational purposes only, and should not be construed as legal advice on any subject matter.

May 13, 2012

On April 24, the Supreme Court of Tennessee upheld an appellate court decision enforcing a settlement agreed upon by an e-mail exchange between the parties’ attorneys. Waddle v. Elrod, No. M2009-02142-SC-R11CV, 2012 WL 1406451 (Tenn. Apr. 24, 2012). The case involved a family dispute over an interest in real property. After counsel exchanged email setting forth terms of the settlement (which included agreement to transfer a property interest), one party recanted and refused to sign the written settlement documents. In the ensuing litigation, the trial court enforced the settlement agreement, but failed to address arguments that Tennessee’s Statute of Frauds (the Statute) precluded enforcement or that the state’s Uniform Electronic Transactions Act (UETA) satisfied the Statute. In addressing both questions, the Tennessee Supreme Court rejected a lower appellate court’s reasoning that the Statute only applied to land sale contracts, and held that the Statute also applied to agreements to transfer land. The court nonetheless opined that that the exchanged e-mails were sufficiently definite writings for purposes of the Statute, and were validated as such by UETA; the court also found that the parties “through their counsel evidenced an intent to finalize the settlement by electronic means,” that UETA “obviate[d] the need for a handwritten signature[,]” and that counsel’s “typed name at the end of the e-mail constitute[d] an ‘electronic signature[,]‘” thereby satisfying the signature requirement of the Statute.