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Electronic execution: Difference between revisions
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So — unless your [[Financial instrument|instrument]] is a [[deed]] or [[lease]] or has such peculiar formal execution requirements — and most [[confirmation]]s, instructions and even master trading agreements which pass between the operational teams of financial institutions won’t<ref>Exception: anything signed as a [[deed]]: a [[security financial collateral arrangement]], for example, or a [[guarantee]] or a master agreement building a security interest in, such as a [[prime brokerage agreement]]</ref> — it needn’t be that complicated. Generally, digital signatures are fine and, in many respects, ''better'' than handwritten signatures, especially a scanned, emailed [[facsimile]] of a handwritten signature which could easily have been forged. | So — unless your [[Financial instrument|instrument]] is a [[deed]] or [[lease]] or has such peculiar formal execution requirements — and most [[confirmation]]s, instructions and even master trading agreements which pass between the operational teams of financial institutions won’t<ref>Exception: anything signed as a [[deed]]: a [[security financial collateral arrangement]], for example, or a [[guarantee]] or a master agreement building a security interest in, such as a [[prime brokerage agreement]]</ref> — it needn’t be that complicated. Generally, digital signatures are fine and, in many respects, ''better'' than handwritten signatures, especially a scanned, emailed [[facsimile]] of a handwritten signature which could easily have been forged. | ||
For a signature – ''any'' signature — is simply a means of gathering and recording evidence and that your counterparty agreed to your transaction or gave the instruction that your records say it did. It is an [[audit]] trail. It is [[due diligence]]. You will only need that evidence should you wind up arguing with your counterparty about your [[contract]]. The moment your counterparty ''denies'' signing it, or confabulates a claim that the terms of your bargain where different from the ones written down on this piece of paper — that is the moment where your counsel, {{jerrold}} pulls out your agreement, slaps it on the registrar’s desk, pointing his spittle-flecked fat little fingers at your adversary’s ''signature'' and triumphantly declares, “Well M’Lud, ''this here'' unequivocal evidence of the defendant’s agreement to the contract says otherwise!” | For a signature – ''any'' signature — is simply a means of gathering and recording evidence and that your counterparty agreed to your transaction or gave the instruction that your records say it did. It is an [[audit]] trail. It is [[due diligence]]. You will only need that evidence should you wind up arguing with your counterparty about your [[contract]]. The moment your counterparty ''denies'' signing it, or confabulates a claim that the terms of your bargain where different from the ones written down on this piece of paper — that is the moment where your counsel, {{jerrold}} pulls out your agreement, slaps it on the registrar’s desk, pointing his spittle-flecked fat little fingers at your adversary’s ''signature'' and triumphantly declares, “Well M’Lud, ''this here'' is unequivocal evidence of the defendant’s agreement to the contract says otherwise!” | ||
So how would you feel were it not a dog-eared contract with a hastily-appended scribble on it, but a two-factor authenticated, time-stamped, [[distributed ledger]]-registered digital record of your counterparty’s authorised officer’s assent? Most well adjusted merchants would say, “rather better”<ref>Or will be until you learn about the courts’ Luddite comprehension of [[Greenclose v National Westminster Bank plc - Case Note|email]].</ref> | So how would you feel were it not a dog-eared contract with a hastily-appended scribble on it, but a two-factor authenticated, time-stamped, [[distributed ledger]]-registered digital record of your counterparty’s authorised officer’s assent? Most well adjusted merchants would say, “rather better”.<ref>Or will be until you learn about the courts’ Luddite comprehension of [[Greenclose v National Westminster Bank plc - Case Note|email]].</ref> | ||
It doesn’t matter if it is a hand-inked signature scratched on onion skin with a quill and waxen seal, | It doesn’t matter if it is a hand-inked signature scratched on onion skin with a quill and waxen seal, a two-factor-authenticated digital signature or, for that matter, a series of unambiguous semaphore messages from a person atop a distant hill whom you sincerely and plausibly believe to be your client. If it ''is'' your client, and you have a record of its assent, however communicated, it will be hard for your client later to claim the contrary. | ||
{{contract vs document}} | {{contract vs document}} | ||