Is our contract unenforceable in Maine because it was signed electronically, or agreed by email?
No, provided the chapter reaches the transaction at all. 10 M.R.S. § 9407 provides that "[a]n electronic record or electronic signature may not be denied legal effect or enforceability solely because it is in electronic form", that a contract may not be denied effect solely because an electronic record was used in its formation, that "[i]f a law requires a record to be in writing, an electronic record satisfies the law", and, the subsection that answers a statute of frauds, that "[i]f a law requires a signature, an electronic signature satisfies the law". The Law Court applied both routes in McClare v. Rocha, holding that "[a]n email or other electronic record can constitute a signed writing based on the historically broad interpretation of the term 'writing' in the statute of frauds and, separately, based on the Uniform Electronic Transactions Act (UETA), 10 M.R.S. §§ 9401-9420", and noting that "[a]lmost any form of writing will satisfy the statute of frauds, including receipts, letters, record books, or computer entries". But the Act is not a free-standing rule of validity. It "applies only to transactions between parties, each of which has agreed to conduct transactions by electronic means", with that agreement "determined from the context and surrounding circumstances, including the parties' conduct"; it "does not apply to a transaction to the extent it is governed by" a law on wills, codicils or testamentary trusts, or by "[t]he Uniform Commercial Code other than Title 11, section 1-1306 and Articles 2 and 2-A"; and "[e]xcept as otherwise provided in this chapter, the effect of any of the provisions of this chapter may be varied by agreement".
The trap
Electronic form is not the defence; consent and content are. McClare vacated a summary judgment against the buyer of land because the emails might be a sufficient writing, and remanded on TWO questions, not one: "there remain genuine issues of material fact as to whether the parties agreed to conduct the transaction by electronic means and whether the parties, in fact, formed a contract." The first of those is the Act's own threshold, and it is the argument most often missed: a party who never agreed to transact electronically is outside the chapter, and nothing in it "require[s] a record or signature to be created, generated, sent, communicated, received, stored or otherwise processed or used by electronic means or in electronic form". Parties can also contract around the Act, because its provisions "may be varied by agreement". And the Act's help runs only to the form of the record: 33 M.R.S. § 51 still requires the memorandum to be "signed by the party to be charged therewith, or by some person thereunto lawfully authorized", and an email from a lawyer or a broker puts the agent's authority in issue, which the Act does not dissolve. Two scope traps for commercial work: the chapter does not reach a transaction governed by the Uniform Commercial Code except for 11 M.R.S. § 1-1306 and Articles 2 and 2-A, so it is no help with a negotiable instrument, a secured transaction or a letter of credit; and it does not reach wills, codicils or testamentary trusts at all.
13 authorities
- statute10 M.R.S. § 9407enactment date not established
The words that state the rule
An electronic record or electronic signature may not be denied legal effect or enforceability solely because it is in electronic form.
- statute10 M.R.S. § 9407enactment date not established
The words that state the rule
If a law requires a record to be in writing, an electronic record satisfies the law.
- statute10 M.R.S. § 9407enactment date not established
The words that state the rule
If a law requires a signature, an electronic signature satisfies the law.
- statute10 M.R.S. § 9403enactment date not established
The words that state the rule
This chapter does not apply to a transaction to the extent it is governed by: A. A law governing the creation and execution of wills, codicils or testamentary trusts; and [PL 1999, c. 762, §2 (NEW).] B. The Uniform Commercial Code other than Title 11, section 1‑1306 and Articles 2 and 2‑A .
- statute10 M.R.S. § 9405enactment date not established
The words that state the rule
This chapter does not require a record or signature to be created, generated, sent, communicated, received, stored or otherwise processed or used by electronic means or in electronic form.
- statute10 M.R.S. § 9405enactment date not established
The words that state the rule
This chapter applies only to transactions between parties, each of which has agreed to conduct transactions by electronic means. Whether the parties agree to conduct a transaction by electronic means is determined from the context and surrounding circumstances, including the parties' conduct.
- statute10 M.R.S. § 9405enactment date not established
The words that state the rule
Except as otherwise provided in this chapter, the effect of any of the provisions of this chapter may be varied by agreement. The presence in certain provisions of this chapter of the words "unless otherwise agreed," or words of similar import, does not imply that the effect of other provisions may not be varied by agreement.
The words that state the rule
An email or other electronic record can constitute a signed writing based on the historically broad interpretation of the term “writing” in the statute of frauds and, separately, based on the Uniform Electronic Transactions Act (UETA), 10 M.R.S. §§ 9401-9420.
The words that state the rule
The UETA provides that an electronic record, such as an email, cannot be denied legal effect or enforceability solely because it is electronic or because an electronic record was used in its formation.
The words that state the rule
Almost any form of writing will satisfy the statute of frauds, including receipts, letters, record books, or computer entries.
The words that state the rule
Considering the evidence in the light most favorable to McClare as the non-prevailing party, Rainey, 2010 ME 56, ¶ 23, 998 A.2d 342, the emails and the circumstances surrounding the parties’ course of dealings are sufficient indicators of the formation of a contract to survive summary judgment; however, there remain genuine issues of material fact as to whether the parties agreed to conduct the transaction by electronic means and whether the parties, in fact, formed a contract. Thus, the court erred in entering summary judgment. 13 The entry is: Judgment vacated. Remand to the Superior Court for further proceedings consistent with this opinion.
- statute33 M.R.S. § 51enactment date not established
The words that state the rule
unless the promise, contract or agreement on which such action is brought, or some memorandum or note thereof, is in writing and signed by the party to be charged therewith, or by some person thereunto lawfully authorized; but the consideration thereof need not be expressed therein, and may be proved otherwise.
- statute10 M.R.S. § 9407enactment date not established
The words that state the rule
A contract may not be denied legal effect or enforceability solely because an electronic record was used in its formation.
“Defective” means that reading found something to correct. What you are reading is the rule as it stands after that reading.