Michigan Appellate Court Enforces Electronic Signature Based On Audit Trail

Electronic Signatures

On October 13, a Michigan Court of Appeals held, in a dispute over the execution of an electronic contract, that a party who  documented its electronic presentation, execution and retention process and audit trails was entitled to summary judgment on a contract claim against a party who offered affidavits denying ever seeing or executing the electronic agreement. Harpham v. Big Moose Inspection, No. 321970, 2015 WL 5945842 (Mich. App. Oct 13, 2015). At issue was a contract for home inspection services, which the plaintiffs denied (by affidavit) ever seeing or executing at the summary judgment stage. In support of its motion for summary judgment, the defendant submitted an affidavit describing its usual process for the delivery of electronic contracts to customers via email by a secure link. In addition, the defendant’s affidavit also described an audit trail which showed: (i) when the agreement was posted to the defendant’s secure website; (ii) the date a link to the agreement on the secure website was emailed to the plaintiffs; (iii) the two times someone using plaintiff’s access credentials to the secure site accessed the agreement; (iv) that someone using the same credentials signed the agreement electronically by clicking a button indicating acceptance; and (v) that the defendant generated and stored a record of that agreement. The court noted that under Michigan law, where the party seeking to enforce the signature has provided admissible evidence of attribution, mere conclusory statements regarding the authenticity of a signature are insufficient to avoid summary disposition. The person denying the authenticity of the signature must provide some admissible evidence countering the evidence supporting attribution.