This bill, like current law under E-sign, does not apply to a transaction
governed by a law relating to the execution of wills or the creation of testamentary
trusts or to a transaction governed by any chapter of this state's version of the
Uniform Commercial Code other than the chapter dealing with sales of goods.
However, because this bill does not contain all of the exemptions currently in effect
under E-sign, this bill may permit a broader use of electronic documents relating to
transactions than is currently permitted under E-sign. Unlike current law, this bill
may permit the use of electronic documents for matters relating to family law;
electronic court documents; electronic notices of the cancellation of utility services;
electronic notices of default, acceleration, repossession, foreclosure, or eviction or the
right to cure under a credit agreement secured by, or a rental agreement for, an
individual's primary residence; electronic notices of the cancellation or termination
of health insurance or life insurance; and electronic notices of product recalls.
Agreements to use electronic documents and electronic signatures
This bill does not require the use of electronic documents or electronic
signatures. Rather, the bill applies only to transactions between parties each of
which has agreed to conduct transactions by electronic means. Under the bill, this
agreement is determined from the context, the surrounding circumstances, and the
parties' conduct. A party that agrees to conduct one transaction by electronic means
may refuse to conduct other transactions by electronic means. Although the bill also
states that a document relating to a transaction may not be denied legal effect solely
because it is in electronic form, it is likely that, consistent with the comments, these
provisions permit a person to deny the legal effect of an electronic document relating
to a transaction if a party to the transaction never agreed to conduct the transaction
electronically. With certain exceptions, the parties to any transaction may agree to
vary the effect of this bill as it relates to that transaction.
Consumer protections
Unlike current law under E-sign, this bill does not contain any protections that
specifically apply only to consumers. The consumer protections currently in effect
under E-sign would likely have no effect in this state upon the enactment of this bill.
Legal effect of electronic documents and electronic signatures
As noted earlier, this bill specifies that a document or signature may not be
denied legal effect or enforceability solely because it is in electronic form. The bill
also specifies that a contract may not be denied legal effect or enforceability solely
because an electronic document was used in its formation. These provisions are
similar to provisions in current law under E-sign. Unlike E-sign, this bill further
states that an electronic document satisfies any law requiring a record to be in
writing and that an electronic signature satisfies any law requiring a signature.
Effect of laws relating to the provision of information
Under this bill, if the parties to a transaction have agreed to conduct the
transaction electronically and if a law requires a person to provide, send, or deliver
information in writing to another person, a party may, with certain exceptions,
satisfy the requirement with respect to that transaction by providing, sending, or
delivering the information in an electronic document that is capable of retention by
the recipient at the time of receipt. Although the bill also states that a document
relating to a transaction may not be denied legal effect solely because it is in
electronic form, it is likely that, consistent with the comments, the bill permits a
person to deny the legal effect of an electronic document relating to a transaction if
the electronic document is provided, sent, or delivered in violation of this provision.
The bill further provides that an electronic document is not enforceable against the
recipient of the document if the sender inhibits the ability of the recipient to store
or print the document.
The bill also specifies that, with certain exceptions, a document must satisfy
any law requiring the document to be posted or displayed in a certain manner; to be
sent, communicated, or transmitted by a specified method; or to contain information
that is formatted in a certain manner. There are three possible interpretations of this
provision. First, the provision may prohibit the use of an electronic document if a law
requires the document to be posted, displayed, sent, communicated, transmitted, or
formatted on paper. Second, the provision may instead require a paper document to
be used in addition to an electronic document in these circumstances. Third,
consistent with the comments, the provision may require the parties to a transaction
to comply with any legal requirement relating to the provision of information other
than a requirement that the information be provided on paper.
Attribution of electronic documents
Under this bill, an electronic document or electronic signature is attributable
to a person whose act created the document or signature. The act of a person may
be shown in any manner, including through the use of a security procedure that
determines the person to whom an electronic document or electronic signature is
attributable.
Effect of change or error
This bill contains three provisions that determine the effect of a change or error
in an electronic document that occurs in a transmission between the parties to a
transaction. First, if the parties have agreed to use a security procedure to detect
changes or errors and if one of the parties fails to use a security procedure and an
error or change occurs that the nonconforming party would have detected had the
party used the security procedure, the other party may avoid the effect of the changed
or erroneous electronic document. Second, in an automated transaction involving an
individual, the individual may avoid the effect of an electronic document that results
from an error made by the individual in dealing with the automated agent of another
person, if the automated agent did not provide an opportunity for prevention or
correction of the error. However, an individual may avoid the effect of the electronic
document only if the individual, at the time he or she learns of the error, has received
no benefit from the thing of value received from the other party under the transaction
and only if the individual satisfies certain requirements relating to notification of the
other party and return or destruction of the thing of value received. Third, if neither
of these provisions applies to the transaction, the change or error has the effect
provided by other law, including the law of mistake, and by any applicable contract
between the parties.
Electronic notarization and acknowledgement
Like current law under E-sign, this bill permits electronic notarization,
acknowledgement, or verification of a signature or document relating to a
transaction, as long as the electronic signature of the person performing the
notarization, acknowledgement, or verification is accompanied by all other
information required by law.
Retention of electronic documents
Under this bill, any law that requires retention of a document may, with certain
exceptions, be satisfied by retaining an electronic document, as long as the retained
information satisfies certain requirements relating to accuracy and accessibility.
The bill contains similar provisions with regard to laws requiring retention of a
check, although the term "check" is not defined under the bill and, as a result, may
not include a share draft or money order. These provisions are similar to current law
under E-sign. However, unlike E-sign, this bill specifies that an electronic
document that is required to be retained must accurately reflect the information set
forth in the document after it was first generated in its final form as an electronic
document or otherwise. The comments indicate that this provision is intended to
ensure that the content of a document is retained when documents are converted or
reformatted to allow for ongoing electronic retention. However, this provision may
be interpreted to permit a retention requirement to be satisfied by retaining only the
final version of a document that has earlier versions.
The bill provides that an electronic document retained in compliance with these
provisions need not contain any information the sole purpose of which is to enable
the document to be sent, communicated, or received. Under current law, this
ancillary information is normally required to be retained along with the document
to which it is attached. In addition, as under E-sign, an electronic contract or
document retained in compliance with these provisions generally has the same legal
status as an original document. Like E-sign, this bill also provides that a person may
comply with these electronic document retention provisions using the services of
another person.
The bill provides that the state may enact laws, after enactment of this bill, that
prohibit a person from using an electronic document to satisfy any requirement that
the person retain a document for evidentiary, audit, or like purposes. It is unclear,
though, what types of retention requirements are enacted for "evidentiary, audit, or
like purposes." It is also unclear how this provision relates to other provisions of the
bill which provide that an electronic document satisfies any retention requirement
as long as specified requirements relating to accuracy and accessibility are also
satisfied.
In addition, the bill specifies that it does not preclude a governmental unit of
this state from specifying additional requirements for the retention of any document
subject to its jurisdiction. It is unclear how this provision relates to other provisions
of the bill which provide that an electronic document satisfies any retention
requirement as long as specified requirements relating to accuracy and accessibility
are also satisfied. It is also unclear whether this provision grants rule-making
authority or merely references any authority that may exist currently. Also,
although it is unclear from the text whether this provision applies to
nongovernmental documents or only to documents in the possession of a
governmental unit, the official comments imply that the provision is intended to
apply to nongovernmental documents that are subject to a governmental unit's
jurisdiction.
Evidence
Under this bill, a document or signature may not be excluded as evidence solely
because it is in electronic form. This provision confirms the treatment of electronic
documents and signatures under current law.
Automated transactions
This bill validates contracts formed in automated transactions by the
interaction of automated agents of the parties or by the interaction of one party's
automated agent and an individual. Under current law, it is possible to argue that
an automated transaction may not result in an enforceable contract because, at the
time of the transaction, either or both of the parties lack an expression of human
intent to form the contract.
Time and location of electronic sending and receipt
Under this bill, an electronic document is sent when the electronic document
a) is addressed or otherwise properly directed to an information processing system
that the intended recipient has designated or uses for the purpose of receiving
electronic documents or information of the type sent and from which the recipient is
able to retrieve the electronic document; b) is in a form capable of being processed by
that information processing system; and c) enters an information processing system
outside of the control of the sender or enters a region of the information processing
system used or designated by the recipient that is under the recipient's control. An
electronic document is received when the electronic document enters and is in a form
capable of being processed by an information processing system that the recipient
has designated or uses for the purpose of receiving electronic documents or
information of the type sent and from which the recipient is able to retrieve the
electronic document. The bill permits the parties to a transaction to agree to alter
the effect of these provisions with respect to the transaction. Under the bill, an
electronic document may be received even if no individual is aware of its receipt.
Furthermore, under the bill, an electronic acknowledgment of receipt from the
information processing system used or designated by the recipient establishes that
the electronic document was received but does not establish that the information
sent is the same as the information received.
These provisions may be interpreted to alter laws under which the date of
receipt of a public record submitted for filing is the date on which a paper copy is
received or postmarked, so that the date of electronic filing constitutes the date of
receipt instead. However, as noted earlier, this bill specifically states that it applies
only to transactions between parties each of which has agreed to conduct
transactions by electronic means. Although the definition of "transaction" may be
interpreted broadly to include a typical governmental action like the filing of a
document, the prefatory note and comments to UETA imply that a narrower
interpretation is intended which covers only the actions of the government as a
market participant. If the narrower interpretation applies, then these provisions
will likely have no effect upon the filing of most public records.
Under this bill, an electronic document is deemed to be sent from the sender's
place of business that has the closest relationship to the underlying transaction and
to be received at the recipient's place of business that has the closest relationship to
the underlying transaction. If the sender or recipient does not have a place of
business, the electronic document is deemed to be sent or received from the sender's
or recipient's residence. The bill also permits a sender to expressly provide in an
electronic document that the document is deemed to be sent from a different location.
The bill also permits the parties to a transaction to agree to alter the effect of these
provisions on the transaction. To the extent that an electronic document may
constitute a sale, with the seller receiving payment electronically, these provisions
may be interpreted to permit a seller to argue that a sale occurred in a jurisdiction
where the seller is not subject to a tax that would otherwise be imposed under
Wisconsin law. However, the official comments imply that this interpretation is not
intended.
In addition, under the bill, if a person is aware that an electronic document
purportedly sent or purportedly received in compliance with these provisions was not
actually sent or received, the legal effect of the sending or receipt is determined by
other applicable law. Although the official comments are silent on the meaning of
this provision, it is likely intended to give a court direction as to what law to apply
to determine the legal effect when there is a failure to send or receive an electronic
document in the manner provided under the bill.
Transferable records
This bill expands current law with regard to transactions involving the use of
transferable records (electronic versions of certain documents under the Uniform
Commercial Code). Although current law under E-sign only permits the use of
transferrable records in transactions secured by real property, this bill permits the
use of transferable records in any transaction in which a promissory note or
document of title under the Uniform Commercial Code may be used. Under this bill,
an electronic document qualifies as a transferable record only if the issuer of the
electronic document expressly agrees that the electronic document is a transferable
record.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB755, s. 1
1Section
1. 16.61 (7) (d) of the statutes is created to read:
AB755,12,32
16.61
(7) (d) This subsection does not apply to public records governed by s.
3137.20.
AB755, s. 2
1Section
2. 16.611 (2) (e) of the statutes is created to read:
AB755,13,32
16.611
(2) (e) This subsection does not apply to public records governed by s.
3137.20.
AB755, s. 3
4Section
3. 16.612 (2) (c) of the statutes is created to read:
AB755,13,65
16.612
(2) (c) This subsection does not apply to documents or public records
6governed by s. 137.20.
AB755, s. 4
7Section
4. Chapter 137 (title) of the statutes is amended to read:
AB755,13,108
CHAPTER 137
9
authentications
AND ELECTRONIC
10
TRANSACTIONS AND records
AB755, s. 5
11Section
5. Subchapter I (title) of chapter 137 [precedes s. 137.01] of the
12statutes is amended to read:
AB755,13,1313
CHAPTER 137
AB755,13,1714
SUBCHAPTER I
15
NOTARIES AND COMMISSIONERS
16
OF DEEDS
; NONELECTRONIC
17
NOTARIZATION AND ACKNOWLEDGEMENT
AB755, s. 6
18Section
6. 137.01 (3) (a) of the statutes is amended to read:
AB755,13,2419
137.01
(3) (a)
Every Except as authorized in s. 137.19, every notary public shall
20provide an engraved official seal which makes a distinct and legible impression or
21official rubber stamp which makes a distinct and legible imprint on paper. The
22impression of the seal or the imprint of the rubber stamp shall state only the
23following: "Notary Public," "State of Wisconsin" and the name of the notary. But any
24notarial seal in use on August 1, 1959, shall be considered in compliance.
AB755, s. 7
25Section
7. 137.01 (4) (a) of the statutes is amended to read:
AB755,14,3
1137.01
(4) (a) Every official act of a notary public shall be attested by the notary
2public's written signature or electronic signature, as defined in s.
137.04 (2) 137.11
3(8).
AB755, s. 8
4Section
8. 137.01 (4) (b) of the statutes is amended to read:
AB755,14,115
137.01
(4) (b)
All Except as authorized in s. 137.19, all certificates of
6acknowledgments of deeds and other conveyances, or any written instrument
7required or authorized by law to be acknowledged or sworn to before any notary
8public, within this state, shall be attested by a clear impression of the official seal or
9imprint of the rubber stamp of said officer, and in addition thereto shall be written
10or stamped either the day, month and year when the commission of said notary public
11will expire, or that such commission is permanent.
AB755, s. 9
12Section
9. Subchapter II (title) of chapter 137 [precedes 137.04] of the statutes
13is amended to read:
AB755,14,1414
CHAPTER 137
AB755,14,1915
subchAPTER ii
16
ELECTRONIC
SIGNATURES
17TRANSACTIONS AND records;
18
Electronic notarization
19
and acknowledgement
AB755, s. 10
20Section
10. 137.04 of the statutes is repealed.
AB755, s. 11
21Section
11. 137.05 of the statutes is renumbered 137.25 and amended to read:
AB755,15,4
22137.25 Submission of written documents records to governmental
23units. Unless otherwise prohibited by law,
with the consent of a governmental unit
24of this state that is to receive a record, any
document record that is required by law
25to be submitted in writing to
a that governmental unit and that requires a written
1signature may be submitted
by transforming the document into as an electronic
2format, but only with the consent of the governmental unit that is to receive the
3document record, and if submitted as an electronic record may incorporate an
4electronic signature.
AB755, s. 12
5Section
12. 137.06 of the statutes is repealed.
AB755, s. 13
6Section
13. 137.11 to 137.24 of the statutes are created to read:
AB755,15,7
7137.11 Definitions. In this subchapter:
AB755,15,11
8(1) "Agreement" means the bargain of the parties in fact, as found in their
9language or inferred from other circumstances and from rules, regulations, and
10procedures given the effect of agreements under laws otherwise applicable to a
11particular transaction.
AB755,15,16
12(2) "Automated transaction" means a transaction conducted or performed, in
13whole or in part, by electronic means or by the use of electronic records, in which the
14acts or records of one or both parties are not reviewed by an individual in the ordinary
15course in forming a contract, performing under an existing contract, or fulfilling an
16obligation required by the transaction.
AB755,15,19
17(3) "Computer program" means a set of statements or instructions to be used
18directly or indirectly in an information processing system in order to bring about a
19certain result.
AB755,15,21
20(4) "Contract" means the total legal obligation resulting from the parties'
21agreement as affected by this subchapter and other applicable law.
AB755,15,23
22(5) "Electronic" means relating to technology having electrical, digital,
23magnetic, wireless, optical, electromagnetic, or similar capabilities.
AB755,16,2
24(6) "Electronic agent" means a computer program or an electronic or other
25automated means used independently to initiate an action or respond to electronic
1records or performances in whole or in part, without review or action by an
2individual.
AB755,16,4
3(7) "Electronic record" means a record that is created, generated, sent,
4communicated, received, or stored by electronic means.
AB755,16,7
5(8) "Electronic signature" means an electronic sound, symbol, or process
6attached to or logically associated with a record and executed or adopted by a person
7with the intent to sign the record.
AB755,16,8
8(9) "Governmental unit" means:
AB755,16,129
(a) An agency, department, board, commission, office, authority, institution, or
10instrumentality of the federal government or of a state or of a political subdivision
11of a state or special purpose district within a state, regardless of the branch or
12branches of government in which it is located.
AB755,16,1313
(b) A political subdivision of a state or special purpose district within a state.
AB755,16,1414
(c) An association or society to which appropriations are made by law.
AB755,16,1715
(d) Any body within one or more of the entities specified in pars. (a) to (c) that
16is created or authorized to be created by the constitution, by law, or by action of one
17or more of the entities specified in pars. (a) to (c).
AB755,16,1818
(e) Any combination of any of the entities specified in pars. (a) to (d).
AB755,16,20
19(10) "Information" means data, text, images, sounds, codes, computer
20programs, software, databases, or the like.
AB755,16,22
21(11) "Information processing system" means an electronic system for creating,
22generating, sending, receiving, storing, displaying, or processing information.
AB755,16,24
23(12) "Record" means information that is inscribed on a tangible medium or that
24is stored in an electronic or other medium and is retrievable in perceivable form.
AB755,17,6
1(13) "Security procedure" means a procedure employed for the purpose of
2verifying that an electronic signature, record, or performance is that of a specific
3person or for detecting changes or errors in the information in an electronic record.
4The term includes a procedure that requires the use of algorithms or other codes,
5identifying words or numbers, encryption, callback, or other acknowledgment
6procedures.
AB755,17,11
7(14) "State" means a state of the United States, the District of Columbia,
8Puerto Rico, the U.S. Virgin Islands, or any territory or insular possession subject
9to the jurisdiction of the United States. The term includes an Indian tribe or band,
10or Alaskan native village, which is recognized by federal law or formally
11acknowledged by a state.
AB755,17,14
12(15) "Transaction" means an action or set of actions occurring between 2 or
13more persons relating to the conduct of business, commercial, or governmental
14affairs.
AB755,17,17
15137.12 Application. (1) Except as otherwise provided in sub. (2) and except
16in ss. 137.25 and 137.26, this subchapter applies to electronic records and electronic
17signatures relating to a transaction.
AB755,17,19
18(2) Except as otherwise provided in sub. (3), this subchapter does not apply to
19a transaction to the extent it is governed by:
AB755,17,2120
(a) Any law governing the execution of wills or the creation of testamentary
21trusts; or
AB755,17,2222
(b) Chapters 401 and 403 to 410, other than ss. 401.107 and 401.206.
AB755,17,25
23(3) This subchapter applies to an electronic record or electronic signature
24otherwise excluded from the application of this subchapter under sub. (2) to the
25extent it is governed by a law other than those specified in sub. (2).
AB755,18,2
1(4) A transaction subject to this subchapter is also subject to other applicable
2substantive law.
AB755,18,4
3(5) This subchapter applies to the state of Wisconsin, unless otherwise
4expressly provided.
AB755,18,8
5137.13 Use of electronic records and electronic signatures; variation
6by agreement. (1) This subchapter does not require a record or signature to be
7created, generated, sent, communicated, received, stored, or otherwise processed or
8used by electronic means or in electronic form.
AB755,18,12
9(2) This subchapter applies only to transactions between parties each of which
10has agreed to conduct transactions by electronic means. Whether the parties agree
11to conduct a transaction by electronic means is determined from the context and
12surrounding circumstances, including the parties' conduct.