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Ask a lawyer – Is an “Accept” button legal in electronic leases?

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Q

We have added a feature to our leases for tenants and owners to read through and accept the terms and conditions. To eliminate the tedious task of them printing out the lease and then signing and sending it back to us, would it be a legally acceptable lease if we have an “ACCEPT” button instead of a fully signed lease?

A

Section 13 of the Electronic Communications and Transactions Act (“ECTA”) provides as follows —

“(1) Where the signature of a person is required by law and such law does not specify the type of signature, the requirement in relation to a data message (for example, an electronic contract) is met only if an advanced electronic signature is used.

(2) Subject to subsection (1), an electronic signature is not without legal force and effect merely on the grounds that it is in electronic form

(3) Where an electronic signature is required by the parties to an electronic transaction and the parties have not agreed on the type of electronic signature to be used, that requirement is met in relation to a data message if– 

(a) a method is used to identify the person and to indicate the person’s approval of the information communicated; and 

(b) having regard to all the relevant circumstances at the time the method was used, the method was as reliable as was appropriate for the purposes for which the information was communicated.

(4) Where an advanced electronic signature has been used, such signature is regarded as being a valid electronic signature and to have been applied properly, unless the contrary is proved. 

(5) Where an electronic signature is not required by the parties to an electronic transaction, an expression of intent or other statement is not without legal force and effect merely on the grounds that– 

(a) it is in the form of a data message; or 

(b) it is not evidenced by an electronic signature but is evidenced by other means from which such person’s intent or other statement can be inferred.”

I have highlighted in bold the sections I deem relevant to your query since, terms of section 5(1) of the Rental Housing Act, a lease between a landlord and tenant need not be in writing.

Therefore, if the parties agree to use an electronic lease, then the use of an “I accept” button would indeed be sufficient to render such an electronic lease legal and binding – that is, there is no need for a written signature, or an advanced electronic signature (which ECTA defines as “an electronic signature which results from a process which has been accredited by the Authority as provided for in section 37”; since this type of signature is not applicable here, it is not presently necessary to explain this point further).

For additional clarity, I would advise incorporating the actual agreement in such a way that, until the user/lessee has scrolled through the full agreement, the “I accept” button remains greyed out. I would also advise including provision within the lease itself for this particular form of “signature”, as well as a clause stating that by clicking the “I accept” button, the lessee confirms that they have read and understood all of the terms and conditions of lease.


Who is Marlon Shevelew?

Marlon Shevelew, director of Marlon Shevelew and Associates.

Marlon Shevelew, director of Marlon Shevelew and Associates.

Marlon Shevelew is the director of Marlon Shevelew and Associates Inc, a  law firm specialising in rental property, sectional title, contractual, consumer and company law. The firm is the recipient of more than 45 international property law awards. Marlon is the current author of PayProp’s rental documentation and preferred rental property attorney to the Institute of Estate Agents South Africa (IEASA), the Rental Housing Tribunal Western Cape, presenter of the Advanced Residential Property Law Seminar endorsed by the University of Cape Town and the director of the top rental property law firm in the country, according to several international publications. Marlon also created the unique Rental Retainer Club and RentDoc which offers clients affordable legal fees for rental property-related matters. Marlon is contactable on marlon@marlonshevelew.co.za anytime for more information on these services.

 

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