Legal Data for Banking

13Electronic and Digital Signatures

In this chapter, we begin by considering the use of signatures as a method of contractual execution, before highlighting the various disadvantages of relying on ‘wet‐ink’ signatures. The discussion then turns to the use of digital and electronic signatures, and the distinction between them. The chapter concludes by examining the current legislative approach to electronic and digital signatures.

Wet‐Ink Signatures

The word ‘signature’ is derived from the Latin term ‘signum’, meaning to ‘sign, mark or seal’, although in today's terms, it usually involves the writing of a name on a document. The signature at the bottom of a legal agreement is one of the foundational blocks of contract law, allowing an individual and/or entity to be bound by the terms of the contractual provisions contained in that legal agreement. It is traditionally viewed as a cursive scribble, representing the signatory's name for the purpose of providing authenticity regarding the origin of a document (the signatory's identity) and the voluntary intention of that signatory to be bound by the contractual terms of the agreement.

Signatures are used in many contexts where their legal effects are at best evidential, such as the signing of a birthday card. However, it is more with the context of signatures where they are intended to create legally enforceable rights and duties (whether immediately, or at some point in the future), through the signing of a legal contract, that ...