When You Sign Documents Electronically, Always Keep a Copy
When Paul, a freelancer in New York, was unable to get a response from a consultant client who owed him money, he thought he might have to sue. I’m downloading the contract , he thought as he rummaged through his inbox for a link to a document he signed months before using HelloSign from a business automation vendor. But when he clicked to open the contract, all he got was an error message. There was no contract. It was impossible to prove that the client owed him money.
The situation exposes a weak spot in our cloud computing world, in which we store documents online indefinitely without having digital backups or paper copies that we might need to refer to someday. It turns out that the cloud is only useful until the documentation you need disappears.
Paul, who asked not to be named, said it took about a week to find the right way to get help from HelloSign. Finally, a company employee confirmed that the contract was removed two months after Paul signed it. Paul should have received an email notification when the customer deleted the contract, but he says nothing came.
Not only has the contract been removed, it has never been signed by the client. “Canceling a request before all signers complete their portions immediately cancels the contract and all copies are deleted,” reads the email explanation Paul received from HelloSign. “Unfortunately, the document can no longer be restored.”
When the cloud contract disappears, the records remain
HelloSign, which was recently acquired by Dropbox, did not comment on Paul’s experience and said that the contracts he facilitates and the storage of those documents is a business, “solely between the parties to the transaction,” according to a company spokesman.
I contacted several other e-signature service companies to see if their policies were the same as HelloSign’s.
Adobe Sign, formerly known as Echosign, said it provides “a comprehensive audit trail out of the reach of the sender,” and in some cases automatically sends copies of documents by email at every step of the signing process.
In DocuSign, the sender of the agreement can choose to delete the document from the system, but it notifies all signers who have the option to download a local copy before this deletion occurs, Ryan Cox, vice president of platform product management at DocuSign, explained via email … After “cleaning” the document, a record of its existence is saved. “Think about how the post office will maintain the delivery history and related data for the package, even if the package was delivered / destroyed / whatever,” Cox said.
Why did the freelancer do this job if the contract was never completed? Paul said he worked with a client before and they were always reliable. After he signed his part of the document, his contact person at the company sent an email that it had been received and he could get to work. When we spoke last week, his payment was being processed, but the company only responded to his repeated telephone and electronic inquiries after he threatened to file a “ Freelance is not free” complaint with the New York City Department of Consumer Affairs. This legislation does not require proof of a formal contract in order to file a non-payment claim.
Paul was now alert. “I do not believe that [e-signature providers] will keep the contract. So the next time I use one of them, I’ll go and download the PDFs of the contract, ”Paul said. He said he downloaded copies of all of his old contracts signed with HelloSign and DocuSign.
How to protect your electronically signed contracts
Paul’s story is a warning not to relax about documents you store in the cloud, especially if they are controlled by another party. Whether it’s a freelance contract, renting your apartment, or signing up to refinance a student loan, uploading electronically signed copies of your documents should be your “early and frequent” task.
If an agreement requires more than one party to sign, don’t assume that the signing process will be completed immediately after you have done your part. Depending on who you do business with, having a signed and sealed book contract may not be on their to-do list.
As mentioned in a recent Tech 911 column from Lifehacker Senior Technology Editor David Murphy, if you digitize your family photos, you’re not just storing them in one cloud service – you’re also making a local copy in case something goes wrong. And keep the originals in a safe place too.
Contracts may not be as sentimental as family photos, but legal and financial issues should be treated with the same caution. Think of the copy that is on the e-signature site as a backup.