Electronic Signatures: Some Important Questions and Answers

By Robert T. Gabor
Aikins, MacAulay & Thorvaldson

May 24, 2001

Manitoba''s Electronic Commerce and Information, Consumer Protection Amendment and Manitoba Evidence Amendment Act (the "Manitoba Act") provides legal recognition to electronic documents and contracts as well as to electronic signatures ("e-signatures"). The Part of the Manitoba Act relating to the use of electronic means to meet government filing requirements has not come into force yet as the necessary regulations to permit for e-filing documents are still being drafted.

The move to legally recognize and regulate e-signatures is occurring elsewhere in Canada as most other Canadian provinces and territories have either passed or are now considering similar legislation. Much of the legislation mirrors the federal government''s Personal Information Protection and Electronic Documents Act (Bill C-6) which includes electronic filing ("e-filing") with the federal government. The trend is the same south of the border as many American states have started to legislate the use of e-signatures. The U.S. federal government recently passed the Electronic Signatures in Global and National Commerce Act which validates and regulates the use of e-signatures in relation to online transactions affecting interstate and foreign electronic commerce ("e-commerce").

What is an E-Signature?

An e-signature is a general, technology-neutral term for "signing" an electronic document. The Manitoba Act defines an e-signature as "electronic information that a person has created or adopted in order to sign an electronic document and that is in, attached to or associated with the document". There are many types of e-signatures, the most common being digital signatures, which can be used indefinitely and are often strings of computer code safeguarded by the utilization of encryption technology. Regardless of which type of e-signature is used, it must be reliable to identify the person and time the e-signature was created as well as to associate the e-signature to the relevant document.

The Impact on Business

All businesses which now use or intend to introduce e-signatures to their operations should understand the impact of these new laws. The Manitoba Act provides that, where a designated law requires a document to be signed, the person may use an e-signature to satisfy the signature obligation provided that certain requirements are met. Businesses must understand these requirements in order to comply with the new laws.

The Manitoba Act does not fully provide a legislative framework for business to business ("B2B") or business to consumer ("B2C") e-signature use, but rather recognizes general contract formation by electronic means, and relies on the common law to provide the substantive legal framework. Courts have found that the general purpose of signatures in contract formation is to demonstrate the consent of the parties and the authenticity of the document. It is anticipated that the courts will likely apply the same or a similar test for e-signatures. As courts have recognized many forms of signatures (such as telegrams, facsimiles, telexes, etc.) it is likely that any symbol that is incorporated in, attached to or which is associated with a document will be considered a legal signature as long as there is a reasonable means of identifying the signatory and authenticating the document.

What Should Your Business Do?

Businesses may use e-signatures in their operations to gain a competitive advantage through reducing the costs or increasing the speed of business transactions. To take full advantage of these opportunities businesses must also understand how their operations will be affected by e-signature provisions in the Manitoba Act as well as other provincial, federal and international laws.

We Can Help

The Tekno Law Practice Group of Aikins, MacAulay & Thorvaldson provides a wide range of services in the fields of technology, intellectual property and privacy law. Whether your business'' use of e-signatures are in relation to e-filing, B2B or B2C, we can provide you with the vital information you require. Please contact the Tekno Law Practice Group or any of its members directly for further assistance in understanding the legal framework for e-signatures or the general application of this new Manitoba Act.