Remember the times when you had to sit and write out a contract with your quill and ink? And then you had to take it with a horse across the distance of a small country to get it signed by the other party? Probably not. In any case, those days are truly over.
Getting a document signed with an electronic signature is now easy. In this post we will look at how signatures have evolved, and how you can avoid trying to sign a contract by trekking on horseback.
First Electronic Signatures
The first real case of people using anything other than pen and paper or wax to sign came in 1869, with the case of Howley v Whipple, in New Hampshire, USA. This is pretty much the first time a signature was given through electronic means to sign something. It is known as the first case of an electronic signature in the US.
This case involved signatures over telegram, and the court ruled:
“It makes no difference whether operator writes with a steel pen an inch long attached to an ordinary penholder, or whether his pen be a copper wire a thousand miles long. Nor does it make any difference that in one case common record ink is used, while in another case a more subtle fluid, known as electricity, performs the same office.”
In non-legal speak that basically means the court held that it makes no difference if you sign something with a pen attached by a wire to a penholder, or write a signature via a telegram over a copper electricity wire. They are both legally the same signature. This case is usually surprising for people who didn't know that the first case of electronic signatures that early, but it is interesting to know that we have been trying to make signature processes more convenient since 150 years ago!
Telephonic and Fax Machine Signatures
The history of the early electronic form of signature continues, with the use of telephonic signatures. Telephonic signatures were a type of electronic signature that uses somebody’s recorded verbal assent or agreement in place of an ink signature. These were particularly popular in the early 20th century. They made verifying the signer's identity pretty easy, as you could cross check against their real voice.
Coming into the later 20th century, fax machines became a widespread method of giving wet ink signatures. The fax machine is a lot older than you might think!
It was invented in 1846 by Scottish inventor Alexander Bain. If you weren't already aware, a fax machine relies on a phone line. The machine scans the document and sees how many white and black areas there are (kind of like a barcode). It then sends these as one electric pulse down the phone line, to the receiving machine. The receiving machine then transmits this electronic pulse to its printer, which then prints it out and reproduces it.
To sign a document with a fax machine, you would give a wet ink signature with a pen, put your document into your fax machine and dial the fax number of the person you wanted to send your signed document to. The fax machine then scans the document and communicates with the receiving fax machine. The receiving machine reproduces a copy to the document, with the signature on it. This was a common way of signing legal documents back then, before we had any computerised e signature solution. It technically counts as an electronic signature, because, it is given over an electronic process.
Modern Electronic and Digital Signatures
Around the 1970s and 1980s, computers were also coming into more widespread use. The first basic digital signatures were conceived in 1978 by Ronald Rivest, Adi Shamir, and Len Adleman.
The first electronically signed agreement between the two countries was the USA and Ireland in 1998, underlining the growing importance of the promotion of electronic commerce.
In the 1990s and 2000s, regulations on electronic signatures started to come into force. In 2000, the USA signed the federal E-Sign Act. It essentially set out when electronic signatures can be used in the USA.
Here in Estonia, the Digital Signatures Act came into force in 2000 (later superseded by eIDAS) and the first digital signature was given in Estonia in 2002.
In 2014, in the EU, the Electronic Identification, Authentication and Trust Services Regulation - better known as eIDAS came into force. This set out various rules and regulations for digital signatures and digital services in the EU.
European Commission: eIDAS
In 2014, in the EU, the Electronic Identification, Authentication and Trust Services Regulation - better known as eIDAS came into force. This set out various rules and regulations for digital signatures, data, and digital services in the EU.
eIDAS set out different levels of digital signature. These are: simple electronic signatures, advanced electronic signature and qualified electronic signature.
Simple Electronic Signatures are ones that require little verification, such as a person's email signature.
Advanced Electronic Signatures reliably identify the signer and make a unique link between the signature and the signer.
Qualified Electronic Signatures are the highest level of signature. They are equivalent to a handwritten signature, as they are backed with a form of government ID and verified by a trust service provider.
Qualified electronic signatures rely on something called Public Key Infrastructure (PKI). With Public Key Infrastructure, there is a public, and private key to sign a document. The private key is used solely the signer to give electronic signatures. The public key is openly available and used by those who need to validate the signer’s electronic signature.
The European Commission setting out exactly which kinds of digital signature and electronic signature are valid, and fit with the existing legal framework means that people can trust what they use to sign. Electronic signature software now usually have advanced and qualified electronic signature methods such as Bank ID, Smart-ID and Mobile-ID.
Benefits of Electronic Signatures to Sign Documents
Even in the more modern times where fax machines were common, signing documents was still a pretty inconvenient process. If you don’t have a fax machine, then you need to sign documents on paper and send them through the postal system. That comes with a whole heap of security risks, such as important and confidential documents being intercepted by bad actors. Documents sent over the post also meant a slow process for parties involved, and mean there are no electronic records of documents.
As we all know, there’s the environmental cost of paper. It takes around 5 grams of carbon to make paper, which doesn’t sound like very much, right? But, if a business has 20 new employees to onboard, and the employment contracts are around 8 pages, that’s 160 pages, which is 800 grams of carbon. That’s like driving 8km in a diesel car. As well as a slower processes and lack of electronic records, creating more carbon emissions is not what we want to do with our signing process.
The increasingly widespread use of electronic signatures has certainly made people’s and businesses' lives a lot simpler and easier. Now, instead of printing or faxing things, you can just send over a document for someone to sign in the e sign tool. This has meant people can save time, and create and send documents in their e sign tool.
Drawbacks of Current Electronic Signature Tools
In e sign tools, documents are typically uploaded for signing from your computer. Usually they get converted to PDF. After that, you go through a process to assign signature fields to the people you need to sign the document. You then send out the document for signing. The parties will receive a link to the document, where they can then sign, usually by using some kind of virtual pen tool to draw their signature on.
But even that comes with some challenges and manual work. Sometimes if the e-signature tool you’re using is just for collecting e-signatures, you might need to spend some time in emails and other tools, negotiating terms, checking clauses with external lawyers, and filling in details in a word processor.
Using an all-in-one platform for your electronic signing can help with some of those troubles.
Using Agrello for Digital Signature
In Agrello, you can use creation tools and edit your documents in the draft phase as much as you’d like. This is through our Office integration- you basically have access to a full suite of Office tools, including Microsoft Word, right inside of your e-signing platform.
When you move to “approved for signing” you can then share the document with external parties who can check the contract with you. This means that there is no emailing things back and forth, you simply just invite those who need to be updated on the document.
When you send the document out for signing, the other party will receive an invite and be able to make an account to access and sign, or can sign quickly and easily with login-less signing. This means that everything is kept in one place and you don’t need to use multiple different tools to sign something. You can get everything signed electronically easily and quickly.
After signing is completed, you can then view all your documents in one place. Different management features such as folders means you can organise your documents easily. Permission and access management also allows you to invite members to your workspace. You can assign them to different folders, depending on what documents they need to see or edit. The allows users to see only specific document(s) that you want them to see.
If you open your signed document from Agrello in Acrobat Sign or Adobe Acrobat, you will also be able to see the digital certificate associated with your signatures. The digital certificate will tell you the signer identity, the time and date of the PDF signature, and whether the document and electronic signatures have been modified or not.
With Agrello's Zapier integrations, you can connect you signed documents and electronic signature processes with many different online services. For example, you could create a Zapier connection that sends your signed documents to Google Drive. Or, you could create a Google Forms that creates a contract whenever a news forms entry is submitted. This is great for small businesses who need to do a lot with relatively few, or disconnected tools.
We’ve come a long way since scratchings in stone tablets, signet rings, and fax machines. But the essential fact remains that signing documents for various purposes is not going away.
Signing documents once used to be a complicated process. You might have to have used a wax seal, or a telegraph. If you were in more modern times, maybe that meant using a fax machine to rudimentarily put signatures on a document. And if it was nowadays, you may have had to try and create and sign documents with multiple different softwares.
Now that signature creation methods have evolved significantly, it’s time to start thinking about how you can evolve your business processes.How could you make some of your signing processes more efficient?
If you want to talk to us about evolving your company’s signature and contract processes, you can contact us here.