Electronic Estate Planning Signatures: Are they valid?

It's not entirely clear...it's squishy.

In short: Electronic signatures and transactions will not always suffice in lieu of physical documents and physical or “wet” signatures.

Take for example the Utah Code which contains a set of laws about the effectiveness of electronic transactions and electronic signatures, called the Uniform Electronic Transactions Act (“UETA”). Similar or identical statutes have been adopted in many other states. Utah’s UETA explains the types of circumstances that need to exist to legally permit electronic signatures within the context of “transactions” (I.E., Actions between two or more people relating to business, commercial, or governmental affairs), which are used to permit electronic transactions.

Electronic Signatures

Regarding both electronic signatures and electronic transactions, the UETA does not apply to:

1.      Wills (*Read further to see the exceptions);

2.      Codicils (I.E. Changes to Wills);

3.      Testamentary trusts; and

4.      Most commercial transactions, including negotiable instruments (such as checks), bank deposits and collections, funds transfers, letters of credit, documents of title (such as deeds), investment securities, and secured transactions. (The UETA does however apply to the commercial transactions of sales and leases with certain restrictions.)

The UETA references a few situations in which electronic signatures and electronic transactions will not be valid or enforceable:

1.      Electronic signatures and electronic records are not sufficient when the signature or record was not the act of the person whose identity is linked to it;

2.      Electronic signatures/transactions are not sufficient when one or more of the people involved in the transaction has not agreed to conduct transactions by electronic means; and

3.      All state governmental agencies have the option to prohibit electronic transactions or signatures.

Otherwise, if an electronic signature, transaction, or record (i) is covered by the rules of the UETA, (ii) was an act of the correct person, (iii) involves all parties having agreed to conduct their transactions electronically, and (iv) is not prohibited by a specific governmental agency’s rules, then the electronic signature, transaction, or record likely will be valid and enforceable. The UETA states: “If a law requires a record to be in writing, an electronic record satisfies the law;” and “If a law requires a signature, an electronic signature satisfies the law.” Even notaries can also electronically sign electronic documents, under certain circumstances and rules as described in the Utah Code Ann. § 46-1-16(8). (See also UETA: § 46-4-205.)

Wet signature...

*All this, however, is complicated by the adoption of the Uniform Electronic Wills Act (Utah Code §§ 75-2-1401 to 75-2-1411). This allows for the electronic execution of a Will instrument. The Act authorizes use of electronic signatures for the principal, the witnesses and the notary under certain circumstances. Trusts and powers of attorney are not included in this Act, and there are significant issues with interstate enforcement of electronically signed documents as some states have not adopted the uniform Act or have not adopted all parts of it.

It is prudent to seek the advice of a licensed attorney in your jurisdiction before relying on an electronic signature for some or all of your estate planning documents.

Curry Andrews, Attorney at Law