eSignature Legality in Canada (Alberta, British Columbia, Ontario, and Quebec)

E-Signature Legality Summary

The federal government has enacted PIPEDA which, among other things, states that a signature requirement in one of the specified provisions of federal laws is satisfied by an electronic signature. Since PIPEDA is drafted to only apply to specific provisions of certain federal statutes, it leaves more gaps in the permissibility of electronic signatures than are seen at the provincial level. However, some other federal statutes have independently incorporated language explicitly permitting electronic documents and signatures (e.g., the Canada Business Corporations Act has its own provisions setting out terms for use of electronic documents).

Legislation governing electronic transactions and commerce has been enacted in all provinces and territories of Canada.

Alberta, British Columbia and Ontario have all enacted legislation based on Uniform Electronic Commerce Act of Canada (“UECA”) model legislation:

• Alberta: Electronic Transactions Act (2001) (“Alberta Act”).
• Ontario: Electronic Commerce Act (2000) (“Ontario Act”).
• British Columbia: Electronic Transactions Act (2001) (“BC Act”).

Quebec has adopted its own legislation governing electronic transactions and commerce, namely, the Act to establish a legal framework for information technology (the “Quebec Act”). Certain requirements related to electronic transactions and commerce also are governed by the Civil Code of Quebec (“CCQ”) and the Consumer Protection Act (“CPA”).

Types of Electronic Signature

PIPEDA: An electronic signature is a “signature that consists of one or more letters, characters, numbers or other symbols in digital form incorporated in, attached to, or associated with an electronic document.” PIPEDA also recognizes—and requires—the use of a “secure electronic signature” in certain circumstances. A secure electronic signature is an electronic signature that results from the application of a technology or process prescribed by regulation, with the regulations setting out a specific set of consecutive operations that must be completed for the signature to qualify.

Alberta Act: An electronic signature is “electronic information that a person creates or adopts in order to sign a record and that is in, attached to or associated with the record.”

Ontario Act: An electronic signature is “electronic information that a person creates or adopts in order to sign a document and that is in, attached to or associated with the document.”

BC Act: An electronic signature is “information in electronic form that a person has created or adopted in order to sign a record and that is in, attached to or associated with the record.”

Quebec Act: The Quebec Act does not define “electronic signature”, but provides that “the link between a person and a document, whatever the medium used may be established by a person’s signature.” A “signature” is defined in the CCQ as “the affixing by a person, to a writing, of his name or a mark distinctive to him which he regularly uses to signify his consent.”

Documents That May be Signed Electronically

Under PIPEDA, a requirement under a provision of federal law for a signature is satisfied by an electronic signature if:

• The provision is listed in the applicable schedules to PIPEDA (currently, these schedules only list certain provisions from the following federal legislation and regulations: Federal Real Property and Federal Immovables Act, Canada Labour Code, Canada Land Surveys Act, and the Federal Real Property Regulations); and
• Regulations respecting the application of section 43 have been complied with. Note that at this time there is only one regulation affecting this section, and it only relates to the electronic signature of the Minister or an officer authorized under the Federal Real Property and Federal Immovables Act.

The following transaction types in Alberta, BC, Ontario, and Quebec are generally eligible for the use of electronic signatures:

• HR documents, such as regular employment contracts, non-disclosure agreements, employee invention agreements, privacy notices, benefits paperwork, and other new employee onboarding processes;
• Commercial agreements between corporate entities including non-disclosure agreements, purchase orders, order acknowledgements, invoices, other procurement documents, software license agreements, tool license agreements, component supply agreements, sales agreements, distribution agreements, and service agreements;
• Corporate documents, such as instruments of transfer, directors’ resolutions, shareholders’ resolutions, government filings indicating updates to corporate information (e.g., change of address or directors), share subscriptions, and shareholders’ agreements (subject to some narrow exceptions, such as share certificates requiring manual execution in BC);
• Consumer agreements including new retail account opening documents, sales terms, services terms, software licenses, purchase orders, order confirmations, invoices, shipment documentation, user manuals, and policies;
• Unless otherwise specifically exempted under their respective legislation, certificates, licenses, notices, disclosure, reports, etc. from governmental entities; and
• Certain intellectual property licenses and transfers, such as trademark licenses and assignments.

Further Guidance

PIPEDA requires use of secure electronic signatures in certain circumstances, such as application of a person’s seal, requirements for original documents, requirements for witnessed signatures, statements declaring truth, and statements made under oath. PIPEDA also sets out the protocol to be followed for the type of document being signed.

In Ontario and Alberta, a legal requirement for a signature that is to be provided to a public body is satisfied by an electronic signature if:

1. the electronic signature meets the public body’s information technology standards that have been established, if any; and
2. the electronic signature meets the requirements, if any, of the public body as to the method of making the signature and as to reliability of the signature.

The Quebec Act provides that the link between a person and a technology-‎based document may be established by any process or combination of processes, to ‎the extent that it allows:

1. the identity of the person and, where applicable, their ‎location, to be confirmed, and allows their link with the document to be confirmed; ‎and
2. the document to be identified and, if need be, allows its origin and ‎destination at any given time to be determined.

Under PIPEDA, the Alberta Act, the BC Act, and the Ontario Act, if an electronic signature is permitted for the document at issue, then the definition of an electronic signature is quite broad and allows many methods to satisfy such requirements. In addition to complying with all applicable legal requirements, best practices to ensure enforceability of an electronic signature are to:

(a) authenticate the signer, including if a corporate transaction, ensuring the signer has authority on behalf of the corporate entity, to sign;
(b) receive explicit consent from the signer—either in a separate agreement or as part of the agreement being signed—that the signer intends to use the type of electronic signature at issue when signing the document;
(c) ensure that the document is rendered tamper-evident after application of the signature; and
(d) create an audit log that captures all signer actions.

The level of authentication and consent may vary depending on the nature of the contract, the relationship of the parties, and other factors.

For Quebec, the definition of signature is not medium-specific (paper or electronic). As such, as long as an electronic signature consists of a personal mark which is commonly used by a person to show consent, that electronic signature will be valid, provided that the law does not prohibit the use of an electronic signature for that particular document.

Case Law

Relevant case law addressing the use of electronic signatures in Canada includes:

• Tabet v. ‎Equityfeed ‎‎Corporation, 2017 (QCCS);
• Roussel v. Desjardins Sécurité financière, compagnie d'assurance-vie, 2012 (QCCQ);
• Johal v. Nordio, 2017 (BCSC);
• Lesko v. Solhjell, 2019 (BCCRT);
• Leoppky v. Meston, 2008 (ABQB);
• Gryckiewicz v. Ironside, 2015 (ABQB).