March 17th, 2011 at 11:09 pm
As you know, digital signatures are becoming more and more common in our transactions. The use of these technologies, however, have raised a number of questions that we need to be mindful of. First is the security of your digital account. Specifically, you and your client need to make sure that you don’t do anything which gives unauthorized access to your account. For example, we have seen instances where an e-mail was sent to a seller with a link to their account, telling them to click on the link to sign documents. The link is created by the system after the client signs in, so no password is needed when the link is used. If that e-mail is then forwarded, the link is still active and the recipient of the e-mail can now click on the link, access the seller’s account and sign documents on their behalf. Obviously, we need to avoid this situation. As a result, please do not forward e-mails of this nature. Be very mindful to protect access to your digital account.
Next, what happens if you, as the listing agent, have a digital account but the selling agent does not. Can you or your TC forward documents from your account directly to the buyer to make the transaction move more quickly? Unfortunately, the answer is no. Obviously, forwarding documents to a client should also involve some advice and discussion regarding the document itself, what is means and why it is being signed. As a result, the other side may believe we should be giving them advice regarding the specific document. In other words, by sending documents to the other side, we may be creating an agency with that client that we don’t want to have. Of course, that agency brings liability. Additionally, dealing directly with the other side may create conflicts of interest and disclosure obligations with regard to our client. In short, by using our digital account for the other side’s documents, we are blurring the line on agency and creating problems for ourselves. So, as inconvenient as it may be, make the other agent forward documents to his/her client. If that agent does not have a digital account, they will need to print out the documents and deliver them to the client. Unfortunately, that is the only way to properly represent our client and avoid additional liability.
As always, feel free to contact us with any questions you may have.
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