Is this contract unenforceable because it was signed electronically?
No, not on that ground. A record or signature may not be denied legal effect or enforceability solely because it is in electronic form, and a contract may not be denied legal effect or enforceability solely because an electronic record was used in its formation. Where a law requires a record to be in writing, an electronic record satisfies that law; where a law requires a signature, an electronic signature satisfies it.
The trap
The section removes one objection and supplies nothing else, but the chapter supplies an enforceability bar of its own: under § 322.008(c), if a sender inhibits the recipient's ability to store or print an electronic record, that record is not enforceable against the recipient. And the chapter has a threshold before agreement: § 322.003 does not reach a transaction governed by a law on wills, codicils or testamentary trusts, or by the UCC other than Chapters 2 and 2A. Whether a mark is an 'electronic signature' at all turns on § 322.002(8), a sound, symbol or process executed or adopted 'with the intent to sign the record'. Under § 322.005(d) the effect of the chapter's provisions may be varied by agreement except where it says otherwise, so most of it is default law. § 26.01 itself requires a writing AND a signature, so § 322.007(c) and (d) both do work. Federal E-SIGN (15 U.S.C. § 7001) may govern the same record and is not addressed here, and it only applies at all between parties who AGREED to deal electronically. § 322.005(b) confines the chapter to transactions between parties each of which has agreed to conduct transactions by electronic means, with agreement found from context and conduct; (c) lets a party that agreed once refuse the next time, and that right cannot be waived. So the first question is not whether the signature is electronic but whether the other side ever agreed to electronic dealing. Attribution is a separate step: under § 322.009(a) an electronic record or signature is attributable to a person only if it was that person's act, shown in any manner including the efficacy of a security procedure, and under (b) the EFFECT of a record so attributed is 'determined from the context and surrounding circumstances at the time of its creation, execution, or adoption, including the parties' agreement, if any, and otherwise as provided by law', so attribution establishes authorship, not terms. Retention is answered rather than left open: § 322.012(a) satisfies a retention requirement with an electronic record that accurately reflects the information and 'remains accessible for later reference', and (d) satisfies a law demanding the ORIGINAL form with a record retained under (a). Read this with the statute-of-frauds rule on Tex. Bus. & Com. Code § 26.01: § 322.007(c) is what lets an electronic record satisfy that section's 'in writing' requirement, so the two operate as a pair.
8 authorities
- statuteTex. Bus. & Com. Code § 322.007enacted 2009-04-01
The words that state the rule
(a) A record or signature may not be denied legal effect or enforceability solely because it is in electronic form. (b) A contract may not be denied legal effect or enforceability solely because an electronic record was used in its formation. (c) If a law requires a record to be in writing, an electronic record satisfies the law. (d) If a law requires a signature, an electronic signature satisfies the law.
- statuteTex. Bus. & Com. Code § 322.005enacted 2009-04-01
The words that state the rule
(b) 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. (c) A party that agrees to conduct a transaction by electronic means may refuse to conduct other transactions by electronic means. The right granted by this subsection may not be waived by agreement. (d) Except as otherwise provided in this chapter, the effect of any of its provisions 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. (e) Whether an electronic record or electronic signature has legal consequences is determined by this chapter and other applicable law.
- statuteTex. Bus. & Com. Code § 322.009enacted 2009-04-01
The words that state the rule
(a) An electronic record or electronic signature is attributable to a person if it was the act of the person. The act of the person may be shown in any manner, including a showing of the efficacy of any security procedure applied to determine the person to which the electronic record or electronic signature was attributable. (b) The effect of an electronic record or electronic signature attributed to a person under Subsection (a) is determined from the context and surrounding circumstances at the time of its creation, execution, or adoption, including the parties' agreement, if any, and otherwise as provided by law.
- statuteTex. Bus. & Com. Code § 322.012enacted 2009-04-01
The words that state the rule
(a) If a law requires that a record be retained, the requirement is satisfied by retaining an electronic record of the information in the record which: (1) accurately reflects the information set forth in the record after it was first generated in its final form as an electronic record or otherwise; and (2) remains accessible for later reference. (b) A requirement to retain a record in accordance with Subsection (a) does not apply to any information the sole purpose of which is to enable the record to be sent, communicated, or received. (c) A person may satisfy Subsection (a) by using the services of another person if the requirements of that subsection are satisfied. (d) If a law requires a record to be presented or retained in its original form, or provides consequences if the record is not presented or retained in its original form, that law is satisfied by an electronic record retained in accordance with Subsection (a). (e) If a law requires retention of a check, that requirement is satisfied by retention of an electronic record of the information on the front and back of the check in accordance with Subsection (a). (f) A record retained as an electronic record in accordance with Subsection (a) satisfies a law requiring a person to retain a record for evidentiary, audit, or like purposes, unless a law enacted after January 1, 2002, specifically prohibits the use of an electronic record for the specified purpose. (g) This section does not preclude a governmental agency of this state from specifying additional requirements for the retention of a record subject to the agency's jurisdiction.
- statuteTex. Bus. & Com. Code § 322.003enacted 2019-09-01
The words that state the rule
(a) Except as otherwise provided in Subsections (b) and (e), this chapter applies to electronic records and electronic signatures relating to a transaction. (b) This chapter does not apply to a transaction to the extent it is governed by: (1) a law governing the creation and execution of wills, codicils, or testamentary trusts; or (2) the Uniform Commercial Code, other than Sections 1.107 and 1.206 and Chapters 2 and 2A .
- statuteTex. Bus. & Com. Code § 322.008enacted 2009-04-01
The words that state the rule
(c) If a sender inhibits the ability of a recipient to store or print an electronic record, the electronic record is not enforceable against the recipient.
- statuteTex. Bus. & Com. Code § 322.002enacted 2009-04-01
The words that state the rule
(8) "Electronic signature" means an electronic sound, symbol, or process attached to or logically associated with a record and executed or adopted by a person with the intent to sign the record.
- statuteTex. Bus. & Com. Code § 26.01enacted 2005-09-01
The words that state the rule
(a) A promise or agreement described in Subsection (b) of this section is not enforceable unless the promise or agreement, or a memorandum of it, is (1) in writing; and (2) signed by the person to be charged with the promise or agreement or by someone lawfully authorized to sign for him.
“Defective” means that reading found something to correct. What you are reading is the rule as it stands after that reading.