If you had any doubts as to the scope of electronic communications in today's business world, this article should serve as a reminder that it is broad, to say the least. Regardless whether or not you are a businessperson, it is useful to be familiar with the basic aspects of our existing laws that relate to electronic information and documents.

With a growing number of thumbs typing away on Personal Digital Assistants (PDAs) and more and more offices going "paperless," it is logical that both the federal government and the provinces have enacted legislation to officially recognize the validity of electronic information and documents.

At the provincial level, the Ontario Electronic Commerce Act, 2000 (the "ECA") sets rules for commercial transactions conducted by Internet, electronic banking and payment systems, electronic purchasing, and business-to-business exchange of data, to name but a few.

The ECA is regulated by the Ontario Ministry of the Attorney General and was established on the basis of the Uniform Electronic Commercial Act (the "UECA"), to promote electronic communications and commerce. The UECA was adopted in 1999 by the Uniform Law Conference of Canada, in an effort to standardize the use of electronic information and documents. It was based on the governing principle that "information shall not be denied legal effect or enforceability solely by reason that it is in electronic form," a logical purpose given the present mobilization of offices and people.

At the federal level, the Personal Information Protection and Electronic Documents Act ("PIPEDA") serves to support and promote electronic commerce by protecting personal information that is collected, used or disclosed in certain circumstances. PIPEDA provides for the use of electronic means to communicate or record information or transactions. Additionally, provisions of the Consumer Protection Act and the Competition Act apply to Internet agreements and Internet practices.

According to the ECA, no person is required to transact using electronic information or documents without having consented to doing so; however, consent can be inferred based on conduct – that is, if a person is corresponding electronically, it is presumed that they are doing so willingly, unless there is evidence to the contrary.

The ECA contains a number of "functional equivalency rules" which ensure that various pre-existing legal requirements relating to written information or documents are satisfied by electronic equivalents. For example, if there is a legal requirement that a document be in writing, the ECA states that the requirement is satisfied if the document is in electronic form and is accessible so as to be usable for subsequent reference. A legal requirement for an original document to be provided is satisfied where there is a reliable assurance that the integrity of the information contained in the electronic document has been maintained from its original form.

In order that information or documents are considered to have been "provided" to a person, when required by contractual agreements, it is not sufficient to merely make them available for access (on a website, for example). The electronic information or document must have been sent by email or displayed in the course of an electronic transaction.

The ECA sets out presumptions for the time and place at which contracts are deemed to have been entered into. In the case of an e-mail, the information or document contained in the e-mail is presumptively received by the recipient when it enters the addressee's information system and becomes capable of being retrieved and processed by the addressee. Unless the parties have agreed otherwise, the information is deemed to have been sent from the sender's place of business and received at the addressee's place of business.

It may seem obvious to some that the validity of information and documents in electronic form should be legal and enforceable; however, there are exceptions to the rule. There are certain documents to which the ECA does not apply and which must be in writing to be deemed valid. They are as follows:

• Wills and codicils

• Trusts created by wills or codicils

• Powers of attorney (in respect of an individual's financial affairs or personal care)

• Documents, including agreements of purchase and sale, that create or transfer interests in land and require registration to be effective against third parties

• Negotiable instruments

• Documents that are prescribed or belong to a prescribed class.

When have you agreed to an electronic contract?

As all computer software users know, offers and acceptances of electronic contracts are often done at the click of a button. The question is, are such agreements enforceable by courts of law?

A "click-wrap" agreement (also called a "click-through agreement") is commonly used in circumstances where an agreement is sought using electronic media. Generally, a click-wrap agreement requires the end-user to indicate assent by clicking an "I agree" dialog box. If the "I agree" box is not clicked, the end-user is presumed to have rejected the agreement.

A "browse-wrap" agreement is one where the terms are posted on a website, and are accessible by hyperlink. There is no take-it-or-leave it option as there is with a click-wrap agreement. The terms of a browse-wrap agreement are presumed to have been accepted by the end-user, given that the user was presented with the opportunity of following the hyperlink to review the specific agreement terms.

Courts will generally enforce a click-wrap agreement because the end-user has been presented with the opportunity of either taking or leaving the contract before proceeding. The enforcement of browse-wrap agreements is more speculative, and courts will look to the circumstances of each particular case before deciding whether or not the terms are to be enforced. Such circumstances may include the placement and the frequency of appearance of the hyperlink.

The theme seems to be that courts will not enforce electronic agreements where the end user was unaware of the terms being agreed to, provided that the user made reasonable efforts to obtain the information.

Probably the most important point to take home is that you should be a conscious electronic information user. Assume that the information and documents that you send and receive will be binding, and assume that when you click "I agree," you are agreeing and you will be held to it. Reading the small print may seem tedious, but remember that blissful ignorance is not going to be your saving grace.

Stephanie Hamilton

BrazeauSeller.LLP

www.brazeauseller.com

Stephanie Hamilton is an associate with BrazeauSeller.LLP. Stephanie can be reached at 613-237-4000 ext. 272, or at shamilton@brazeauseller.com. For more information about Stephanie, please visit www.brazeauseller.com.

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