Lexpert magazine features articles and columns on developments in legal practice management, deals and lawsuits of interest in Canada, the law and business issues of interest to legal professionals and businesses that purchase legal services.
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64 LEXPERT MAGAZINE | APRIL/MAY 2017 TECHNOLOGY | COLUMNS | George Takach is a senior partner at McCarthy Tétrault LLP and the author of Computer Law. province and territory enacting legislation that helps facilitate e-commerce across a range of electronic contracting models. LEGISLATIVE SUPPORT e various e-commerce statutes in Can- ada bolster e-contracting by various means. One provision stipulates that an e-signature is legally enforceable. And the definition of "electronic signature" is very broad, namely any "information in electronic form in, at- tached to or associated with a document in order to sign it." To give you a sense of just how useful this provision in the e-commerce statutes is, the Mutual Fund Dealers Association of Can- ada and the Investment Industry Regula- tory Organization of Canada have both passed policies that allow their members to communicate electronically with their cli- ents as long as the member obtains a legal opinion to the effect that the process for the client communication utilizes a legally enforceable e-signature. I have been asked to assist with many of these requests. Aer working with an individual MFDA or IIROC member to fine-tune their communication and work- flow process (typically their e-oriented ac- count opening system), I am able to give the opinion. Many novel e-workflows have been brought on stream this way, gaining important marketing and efficiency gains for the MFDA or IIROC member — and all well supported by the above-noted e- commerce legislation. THE LEGALITY OF E-KIOSKS So what about the enforceability of the waiver and release obtained through the e-kiosk process at the Go-Kart track de- scribed at the top of this column? Well, just such a fact pattern was at issue in a recent case from western Canada, and the court, on a summary judgement motion, upheld the e-waiver based on several important findings and conclusions. First, the judge found that the design of the customer experience through the vari- ous screens of the kiosk was such that the customer could not participate in a Go- Kart race unless and until he or she clicked "I Agree" to the waiver/release. Moreover, the judge found there was nothing "ob- scure" in the presentation of the waiver and the release, or the choice of whether or not to accept it. erefore, tip number one is: when de- signing the customer experience of elec- tronic contract terms — whether for a waiver or something else — keep it simple and straightforward. And the "I Agree" step has to be clear and obvious. Ideally the actual terms will appear on a screen, and at the bottom (requiring the customer to scroll down through the terms) there is a clear and unambiguous "I Agree" and, be- side it, an "I Decline" button. In coming to its conclusion in this case, the court usefully cited another section of the relevant e-commerce legislation, namely the provision that holds that an offer, or acceptance, or any other element relevant to the formation (or operation) of a contract may be expressed "by an action in an electronic form, including touching or clicking on an appropriately designated icon or place on a computer screen … " is is an important finding of the court. It con- firms that when we are dealing with an e- contract involving a tablet, a kiosk, or some similar user experience, we should not be looking for an e-signature or something that approximates a traditional paper con- tract. Rather, this statutory section stands alone, and confirms that what is really im- portant is the intent to express the offer, acceptance or other matter, not the way in which it is memorialized (though presum- ably the e-system before the court in this case did that as well, including by taking a photo of the customer so that the "I Agree" could be connected to a specific person from an evidentiary perspective). e second important finding by the court in the case is this: the fact that the customer may not have read the waiver does not detract from the waiver's legal ef- fect. In this, the court argued, the electron- ic waiver should not be treated differently than a paper-based one. And in the context of paper, the court cites jurisprudence hold- ing, essentially, that someone who signs a contract is bound by it whether or not they have read it. is is not to say that anything goes when it comes to the actual words used in an electronic waiver/release, or other provi- sions in electronic contracts. In fact, even in this case there was a dispute as to wheth- er the specific words of the release covered the particular damages suffered by the customer. Moreover, there have been other cases, particularly in consumer contracts, where judges have found certain provisions unenforceable because of their complexity, the confusion they caused, etc. So besides designing the electronic customer experi- ence carefully from a contract formation perspective, care should be exercised in preparing the substantive terms of these contracts as well. On balance, though, in this decision we have further support for the legal enforce- ability of well-designed electronic con- tracts. In that sense it is useful not only in respect of e-kiosk waivers, but for a range of other e-contracts concluded through media other than paper. PDF TECHNOLOGIES have come into widespread use, and emails are now used routinely to create contractually intentioned messages. Some businesses have worked recorded voice signatures into their contract creation workflows, especially with remote customers.