We all know that our physical signature can be considered legally binding; but what about electronic “signatures”, generated when we click on the “terms and conditions” buttons used on many websites? Are these binding too, and if so, to what extent?

One of the things that I always try to engrave on the minds of all the delegates who go through my workshops is that it is important to have all your contracts in place. Contracts between you and your partners and contracts between you and your suppliers, contracts between your and your clients and, for goodness sake, contracts between you and your staff.  Contracts are really important.  But what does the word ‘contract’ conjure up for you?  For me it conjures up pages and pages of legalese, most of which I  cannot understand and probably need a whole week to go through, line by line, in order to understand exactly what the terms and conditions contained therein mean.

We’ve all been caught, I’m sure – by the unscrupulous retailers and service providers that have ‘something’ on the reverse of their invoices.  You know which ones I mean – where the writing is so small and squished together that you need a magnifying glass to read it. They are the people, when you query something, who puff themselves up and sarcastically remind you that you accepted said terms and conditions when you accepted the invoice and then very importantly fax/e-mail you the front of the invoice/document that says something along the lines of “when you accept this invoice/document you agree to all the terms and conditions on the reverse of said document”. Of course they never send you the reverse of the document and usually the end result (because it’s too much bother to fight the system) is that you just give up!

But what about electronic signatures?  What about when we ‘click’ on that button that says agree/disagree with the terms and conditions?  I mean really, do any of us even think about what that means? Can anybody hold me legally liable because I clicked on a button?

Yes they can! So if you click on the button to say that you are over 18 and yes you can go into that particular site – you know the one that your mother and father would be horrified if they knew you were going in there – you can be held accountable! And no, it’s no good glaring at me – this is according to the Electronic Communications and Transactions Act 2002, which of course means that it is the law that says so!

In effect the Act says that information cannot be considered ‘without legal force’ just because all of it or even some of it is in the form of a data message.

You see, a ‘data message’ is something that is generated, sent, received, stored and archived electronically, and if they can be accessed or used for reference, then they are recognized by law as legal. Anything that can be printed or saved fulfils the requirements and that of course includes web-pages and e-mails and their attachments. Electronic data are now in fact seen to be the same as paper documents. Therefore they are considered legal.

The Act also says “an electronic signature is not without legal force and effect merely on the grounds that it is in electronic form”. This means that whilst a physical signature is used to make a contract binding, an electronic signature that can be used to identify a specific person and that indicates their approval and acceptance of the electronic information, is considered  a ‘signature’.

It actually goes one step further, because if you reach an agreement on e-mail, for example, that agreement will be considered legal and binding at the time and the place where the offer/agreement was accepted – and our e-mails are pretty much date and time “stamped”.

Clearly that means that when you click on the required spot or you agree to ‘terms and conditions’ on a website, you are committing yourself to a legal and binding contract, which in terms of South African law can be enforced.

Be careful where you click!

Nikki is an Internal Auditor and Business Administration Specialist who can be contacted on 083 702 8849 or nikki@viljoenconsulting.co.za or http://www.viljoenconsulting.co.za

 

Small Business Forum

The Small Business Forum is an independent network of entrpreneurs and small business owners established to encourage and support the creation, growth and development of small business in South Africa.

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