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

E-Signature Legality Summary

The federal government has enacted PIPEDA (SC 2000 c5) which, among other things, states that a signature required by a federal law is satisfied by an electronic signature. (PIPEDA, Section 43). 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). And legislation in various provinces and territories takes a similar approach to PIPEDA:

• Alberta: Electronic Transactions Act, SA 2001, cE-5.5

• British Columbia: Electronic Transactions Act, SBC 2001, c 10

• Manitoba: Electronic Commerce and Information Act, CCSM c. E55

• New Brunswick: Electronic Transactions Act, RSNB 2011, c 145

• Newfoundland and Labrador: Electronic Commerce Act, SNL 2001, c E-5.2

• Northwest Territories: Electronic Transactions Act, S.N.W.T. 2011,c.13

• Nova Scotia: Electronic Commerce Act, SNS 2000, c. 26

• Nunavut: Electronic Commerce Act, SNu 2004, c 7

• Ontario: Electronic Commerce Act , SO 2000, c 17 

• Prince Edward Island: Electronic Commerce Act, RSPEI 1988, c E-4.1

• Saskatchewan: Electronic Information and Documents Act, 2000, S.S. 2000, c. E-7.22

• Yukon: Electronic Commerce Act, RSY 2002, c 66

Generally, eSignature legislation specifies that a statutory requirement that a document be ‎signed is satisfied ‎by an electronic signature meeting the applicable statutory requirements.‎ There are some specific ‎exceptions in each statute where a statutory signature requirement must be satisfied by a traditional ‎‎“wet” signature.‎

Documents that are not subject to a specific legislative mandate to be signed can generally be ‎signed electronically.‎

Types of Permitted Electronic Signature

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, Part 2, Section 31(1)). 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.

Documents That May be Signed Electronically

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

• The relevant legal 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. Currently 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. Copyright assignments cannot be signed electronically - under the federal Copyright Act such assignments must be in writing and signed by the copyright owner.

Further Guidance

Provincial e-signature statutes typically exclude certain documents from the electronic signature provisions. Some examples include:‎

• wills and codicils;‎

• trusts created by wills or codicils;‎

• powers of attorney, to the extent that they are in respect of an individual’s financial affairs ‎or personal ‎care;‎

• records that create or transfer interests in land, including interests in mines and minerals (Alberta), ‎documents that create or transfer interests in land and that require registration to be ‎effective ‎against third parties (BC);‎

• negotiable instruments or instruments of title, unless they may relate to the carriage of ‎goods;‎ and

• consent to a reduction of an insurer’s liability or an increase in the insured’s obligations ‎other than an ‎increased premium in the context of non-marine insurance (Quebec).‎

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:

• The electronic signature meets the public body’s information technology standards that have been established, if any; and

• 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:

• The identity of the person and, where applicable, their ‎location, to be confirmed, and allows their link with the document to be confirmed; ‎and

• 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.

Seminal Case Law

The Canadian courts which have addressed the issue of eSignature and electronic contracting, both federally and in the Provinces, have upheld its use so long as there is an intent to sign and a signature of some form.  Many of the cited cases concern the admissibility of emails as evidence of consent and a signature. Relevant case law addressing the use of electronic signatures in Canada includes:

• Leoppky v. Meston, 2008 ABQB 45 (Alta. Q.B)

• Roussel v. Desjardins Sécurité financière, compagnie d'assurance-vie, 2012 QCCQ 3835

• Vancouver Canucks Limited Partnership v. Canon Canada Inc., 2015 BCCA 144 (B.C. C.A.)

• Gryckiewicz v. Ironside, 2015 ABQB 284

• I.D.H. Diamonds NV v. Embee Diamond Technologies Inc., 2017 SKQB 79 (Sask. Q.B.), affirmed 2017 SKCA 79 (Sask. C.A.)

• Johal v. Nordio, 2017 BCSC 1129

• Tabet v. ‎Equityfeed ‎‎Corporation, 2017 QCCS 3303

• Lesko v. Solhjell, 2019 BCCRT 941

• Regent v. Registrar of Titles, 2022 SKQB 102