What’s in a name? A lot if it’s on an e-mail

High Court decision is a sign of the times

Faxing is still the number one method for sending and receiving official international messages that must be signed, according to a recent Gallup/Pitney Bowes poll.

It costs Fortune 500 companies an average of £8m per year. I doubt that figure includes the cost of wasted space for a fax machine, the pre-fax call (“I think you gave me a phone number”) or the post-fax call (“Did it come through?”).

By comparison, e-mail is easy, does not need a cover sheet, does not arrive as a smudge on paper and is also a legitimate way of sending and receiving messages that must be signed, both in Europe and the US. But the validity of e-mail signatures is not well known.

You make your bed...

It does not have to be this way. A name typed at the foot of an e-mail is still a signature. The High Court acknowledged this in April. An e-mail had been sent from a struggling retailer, Nilesh Metha, to a bed maker in Portugal. The e-mail offered a personal guarantee for £25,000, but it was not signed.

For that reason, Judge Pelling said the Portuguese creditor could not rely upon it in its claim for cash from Metha. The judge was not expecting a digital signature or even a scanned copy of Metha’s handwritten signature. All he wanted was Metha’s name typed at the end. “N Metha” would have sufficed, he said.

Some laws require that documents are in writing and signed. The Statute of Frauds and Perjuries, from 1677, puts personal guarantees among them. It has not been amended to refer to e-mail, although the Electronic Communications Act of 2000 allowed for such tweaks to be made with relative ease. This did not trouble the judge. He simply looked to pragmatic guidance that came from the Law Commission in 2001.

The commission exists to promote the reform of English law. But it reasoned that reform was not necessary for most statutes requiring signatures. They could be satisfied by a functional test: whether the conduct of the would-be signatory indicates an authenticating intention to a reasonable person.

Signed, sealed, delivered

“Digital signatures, scanned manuscript signatures, typing one’s name (or initials), and clicking on a website button are, in our view, all methods of signature, which are generally capable of satisfying a statutory signature requirement,” it wrote.

The Department of Trade and Industry endorsed that view in 2002 and Pelling seconded it. A name was missing from Metha’s e-mail so there was no binding guarantee.

The 2000 act failed its preliminary test – royal assent was to be given by electronic signature, but practicalities frustrated the symbolic gesture. That failure proved prescient.

Like the Queen, we continue to rely on traditional signatures, lacking the confidence to change our ways. Like the missing page of an important fax, the message that e-mail signatures are valid has somehow been lost in transmission.

Rob McCallough is a partner at international law firm Pinsent Masons

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