Contracts - Signature on the bottom vital?

Hi guys,

as my business has started to grow, I've realized the need to be extremely mobile and also to be able to reply fast with proposals. My goal is whenever an inquiry comes in to reply and send a quote/proposal within 30 minutes.

So in order to do that, I'd have to have a laptop with me at all times OR I can run my entire billing through an online service such as Freshbooks. With Fresh books, all I need is access to a computer, even an iPad is good enough and I can literally sent a proposal under 5 minutes.

So far, what I've been doing, is create a proposal, send it to the client via email and PDF, ask them to sign it and email it back to me. I'm sure it is a pain for a client to have to print, sign and then scan and then attach to an email and send an approved form to me. I'd rather not have to make them do that.

Freshbooks, takes care of that very well - once I have the proposal prepared, I just click on "send" and the client received an email with a link to it where they can view it and if all is okay, they can just click on "approved" and I get an email saying that the client has approved my proposal and I'm good to go.

My question is - in case I ever have to take a client to court, if I don't have the client signature on a contract and the approval process is all electronic without a way to verify who approved the proposal (although the email address is the client's), can this hold in court?

an e-mail or scan will not hold up in a court of law, neither will a digital signature, Only a piece of ink on a piece of paper will, And only then if its the original -

That being said usualy saying it will to a client is enough to scare them into paying

Oh wow, so how do you guys make sure a contract between you and a client is valid? Or do you just pray you never have to take them to court? My last client wasn't even in the same city as I ...

LONDON808 wrote in post #14750066
an e-mail or scan will not hold up in a court of law, neither will a digital signature, Only a piece of ink on a piece of paper will, And only then if its the original -

That being said usualy saying it will to a client is enough to scare them into paying

This is substantially - if not completely - wrong.

The only right answer to your question is "it depends." The existence and enforceability of an agreement between two parties really depends on a variety of factors, only one of which is an actual signature. If you have reservations or questions about your current practice with regard to contracts (specifically e-signatures) it would be very beneficial to spend some time with a contract lawyer who can answer questions in view of your particular circumstances.

joe

charro callado wrote in post #14750160
This is substantially - if not completely - wrong.

The only right answer to your question is "it depends." The existence and enforceability of an agreement between two parties really depends on a variety of factors, only one of which is an actual signature. If you have reservations or questions about your current practice with regard to contracts (specifically e-signatures) it would be very beneficial to spend some time with a contract lawyer who can answer questions in view of your particular circumstances.

joe

Thanks. That was going to be my next step. I though perhaps someone on here has already done so so maybe they would be willing to share what they've learned.

pixel_junkie wrote in post #14750171
Thanks. That was going to be my next step. I though perhaps someone on here has already done so so maybe they would be willing to share what they've learned.

For what it's worth my understanding is that a statute of frauds is satisfied through the Uniform Electronics Transactions Act, which allows for an electronic record and signature to stand in place of a physical writing and signature, respectively.

In any case, documentation is critical, so be disciplined when you can and flexible when you need to be.

joe

I spent the last year in a lawsuit (California), with reams of paper generated from printing emails of contracts, agreements, and random "statements" that came up during the situation. Not once did my lawyer say "gee, too bad you didn't get them to sign, scan, and email back this statement - this email is useless".

Dave

LONDON808 wrote in post #14750066
an e-mail or scan will not hold up in a court of law, neither will a digital signature, Only a piece of ink on a piece of paper will, And only then if its the original

This hasn't been correct for many years. Signatures sent by fax have been legally binding/held up in court for years, even though they aren't original.

In fact you don't need a signature at all if you can convince a judge that a verbal contract was formed or demonstrate it through other supporting materials such as correspondence. Obviously it is recommended to get a signature as that is a more compelling piece of evidence.

If you really feel you need the actual signature, you might consider having the prospect email you their acceptance of the contract to get the ball rolling, with the requirement that they follow up by printing it out and "snail"-mailing it with their signature. I think it may be overkill and a little awkward, but you never know.

Just my .02, but even the IRS in the US here doesn't need your signature. The fact that you, in some way attempt to verify that you intend to approve is enough. Courts now also recognize the electronic certified mail receipt as well, vs the old green copy people used to have to sign for.

I would with guys in real estate and environmental stuff at work and there are lawyers there each day. They must be VERY careful what they write in their e-mails as the stuff could be brought into court or an agreement.

I think IRS has you type in your full name as a signature though.

Anyways, my goal is to be able to run my business through my iPad from anywhere and the proposal/estimating and invoicing to be fast end convenient for me and but also for the client (I know they will appreciate that a lot). The alternative to have all my billing in one central location like a laptop is not that attractive to me anymore now that I've discovered Freshbooks.

Thanks for all your help, guys.

I don't do electronic contracts, they are the work of the devil

Pen and ink and face-to-face interaction has worked for 2,000 years there's no harm in using it in 2012, I keep 20 or 30 copies of various contracts in my camera case.

Plus there's nothing like a good firm handshake, you can't do that over TCP/IP

^ That would be ideal but my last client was 90 miles away from me ...

pixel_junkie wrote in post #14752573
^ That would be ideal but my last client was 90 miles away from me ...

In that case then yes I would work something out......which I have done before, but anything local sign on the dotted line please.

I do a lot of event, club and night life so anything far away I usually have them sign when I get there an hour or so prior to shooting......but for weddings and things like that where distance can be an issue I could see the need for something electronic.

charro callado wrote in post #14750160
This is substantially - if not completely - wrong.

The only right answer to your question is "it depends." The existence and enforceability of an agreement between two parties really depends on a variety of factors, only one of which is an actual signature. If you have reservations or questions about your current practice with regard to contracts (specifically e-signatures) it would be very beneficial to spend some time with a contract lawyer who can answer questions in view of your particular circumstances.

joe

This is right. I know, having been a party to it, that even a straight email agreement can be acceptable in court, particularly if the actions of both parties after the agreement indicate that they both had held the agreement valid.