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Electronic Signatures – How to Prove They are Authentic if the Signer Claims the E-Signature was Forged

Electronic signatures are commonly used in California, especially with real estate contract documents, and are accepted by real estate brokers and escrow officers. But what happens when there is a dispute and the person who supposedly e-signed denies doing so, claiming that the signature was forged? That was the case in a recent decision out of San Diego where a homeowner claimed that they did not sign a financing contract for solar panels. The solar company never proved that the “docusigned” electronic signature was the plaintiff’s by explaining the process used to verify the signature.

Sacramento-e-signature-real-estate-contract-attorneyIn Rosa Fabian v. Renovate America, Inc., Renovate made an unsolicited phone call to Fabian about solar panel financing. Fabian was never presented with any documents to sign, claiming that all communications were over the phone.

The court found that Renovate met its initial burden to show an agreement to arbitrate by attaching a copy of the Contract to its petition, which purportedly bears Fabian’s electronic initials and signature. Because Fabian declared that she did not sign the Contract and the e-signature was forged, however, Renovate then had “the burden of proving by a preponderance of the evidence that the electronic signature was authentic.

Sacramento-e-signature-real-estate-attorneyRenovate claimed that the Contract bearing the printed electronic initials and signature is authenticated by DocuSign. DocuSign renders Fabian’s electronic initials and signature “legally binding.” Newton v. American (854 F.Supp.2d 712) explained that DocuSign is a company used to electronically sign documents in compliance with the U.S. Electronic Signatures in Global and National Commerce Act (ESIGN), 15 U.S.C. § 7001 et seq. E-signatures are also provided for in the California Civil Code §1633.9 (set out below)

Renovate argued that Under ESIGN, electronic records and signatures in compliance with ESIGN are legally binding. DocuSign permits a company to send documents to a customer for their signature. The customer opens the document for review containing areas marked for the signatory to execute. The signer creates a signature and must click a button confirming their signature once they have completed all form fields and signed in all required places. But the court here found that, standing alone, this fact is not sufficient.

Renovate never proved that the “docusigned” electronic signature was the plaintiff’s by explaining the process used to verify the signature. In Newton the defendant submitted a declaration stating that it sent a contract to the plaintiff using DocuSign, and that the plaintiff signed the Client Signature portion of the contract. Once signed, the signature was assigned an identifying code, such as the one that appeared above the plaintiff’s signature on the subject contract.

Sacramento-e-sign-real-estate-attorneyHere, Renovate did not provide any evidence from or about DocuSign in its petition, reply, or supplemental declaration. Indeed, the word “DocuSign” does not appear in any of Renovate’s moving papers. Renovate offered no evidence about the process used to verify Fabian’s electronic signature via DocuSign, including who sent Fabian the Contract, how the Contract was sent to her, how Fabian’s electronic signature was placed on the Contract, who received the signed the Contract, how the signed Contract was returned to Renovate, and how Fabian’s identification was verified as the person who actually signed the Contract. The court thus find Renovate’s DocuSign authentication argument unsupported and unpersuasive.

Renovate only “summarily asserted” that Fabian “entered into” the Contract on February 28, 2017. Renovate’s agent did not state anywhere in his declaration that Fabian actually signed the contract, electronically or otherwise. Anderson did not explain, for instance, who presented Fabian with a physical or electronic copy of the Contract, the specific location where the Contract was signed, the time when the Contract was signed, or how the agent ascertained that Fabian was present when the Contract was signed. Nor did the agent make any reference to DocuSign or the process used to obtain and verify Fabian’s “docusigned” electronic initials and signature.

Even after Fabian disputed signing the Contract, Renovate did not suggest how the electronic signature could have only been placed on the Contract by Fabian. For example, it did not make clear the meaning of the letters “DS” or the significance of the words “DocuSigned By:” that appear above Fabian’s electronic initials and signature. Most importantly, Renovate did not explain how Fabian’s electronic initials and signature were the “act of Fabian” by offering evidence that DocuSign assigned Fabian a unique “identity verification code” to initial and sign the Contract. Anderson did not explain the significance of the 15-digit alphanumeric characters or the words “Identity Verification Code: ID Verification Complete” that appear below Fabian’s electronic signature. By not providing any specific details about the circumstances surrounding the Contract’s execution, renovate offered little more than a bare statement that Fabian “entered into” the Contract without offering any facts to support that assertion. This left a critical gap in the evidence supporting Renovate’s petition.

California Civil Code §1633.9 provides:

(a) An electronic record or electronic signature is attributable to a person if it was the act of the person. The act of the person may be shown in any manner, including a showing of the efficacy of any security procedure applied to determine the person to which the electronic record or electronic signature was attributable.
(b) The effect of an electronic record or electronic signature attributed to a person under subdivision (a) is determined from the context and surrounding circumstances at the time of its creation, execution, or adoption, including the parties’ agreement, if any, and otherwise as provided by law.

Civil Code §1633.11 provides for e-notarization, and signatures under penalty of perjury.