Is the electronic signature secure? Yes!
Are you preparing to sign a form electronically during a real estate transaction? Fast, effective and secure, the electronic signature has the merit of saving time for all parties when used correctly. Here are the broad lines of measures taken by the OACIQ to ensure this, as well as an overview of rules that brokers should comply with for your protection.
The OACIQ has developed a strict certification program for firms providing electronic signature solutions. Their use by brokers ensures the validity of the process used, as well as the protection of the parties to the transaction.
The use of a certified solution allows:
- the signature appended electronically on a document to be considered valid;
- the personal information of the parties to a transaction to be protected;
- the broker to recover certain data from service providers;
- the OACIQ to intervene should a problem occur, since it has an agreement with the provider.
Here is the list of solutions certified by the OACIQ so far:
The OACIQ also collaborates with other professionals involved in the transaction to familiarize them with its mechanisms for certifying electronic solutions. The Organization has recently developed a practical guide for notaries to help them validate the authenticity of signatures used via three electronic signature solutions currently certified by the OACIQ.
A growing number of professionals authorized by the OACIQ use such an electronic signature solution to conclude their transactions. Here are a few guidelines to be respected by brokers:
- A broker who uses an electronic signature solution must first evaluate whether this solution is appropriate for the situation where documents need to be signed.
- When a broker wishes to have a document signed electronically and apart from the emailing of the document to be signed, it is important to use a second authentication mechanism to ensure the identity of the person signing the document. Authentication may be done using a password sent by SMS (text), for example, or with answers to questions previously agreed to between the broker and the signing party.
- Then, when one of the parties signs a document, the place of signing must also be indicated. It is possible to add a blank field that will be completed by the signatory. The broker who initiates the signing process is the one who must add the field(s) to be completed before accepting the signature. A field is also needed to allow the other party to signify their acceptance or refusal, as the case may be.
- Finally, entering the date and time is important as it makes it possible, for example, to make sure that the acceptance period of a promise to purchase or counter-proposal is respected in order to make it legally binding between the parties.
Note that a document or form may be signed using an entirely electronic process or a mixed process; for example, one of the parties could hand-sign the documents while the other party signs electronically.
However, an exclusive brokerage contract for the sale or purchase of a chiefly residential immovable containing less than 5 dwellings cannot be signed using a mixed process.
Let’s take the following example:
- A broker represents a couple to sell their property and one of the spouses is outside the province. The broker and one of the two clients, i.e. the spouse who is in Quebec, meet and sign a brokerage contract by hand. Subsequently, this contract is digitized and sent to the other client to sign it electronically. The broker gives this last copy to each of the two clients.
This practice is not acceptable, since the remittance of a contract signed by using a mixed process cannot be considered as a duplicate. It is a copy.
Section 25 of the Real Estate Brokerage Act states that the real estate broker must give a duplicate of the contract to the client, i.e. a copy containing the original signatures of the parties or signatures that were authenticated according to an electronic signature protocol.
For any questions concerning the use of electronic signatures, please contact the Info OACIQ information centre.
Learn more about the obligations of real estate and mortgage brokers by checking the What’s a professional authorized by the OACIQ? page.