| Chairman Linda W. Cropp At the Request of the
Mayor of the District of Columbia
A BILL IN THE COUNCIL OF THE DISTRICT OF COLUMBIA
Chairman Linda W. Cropp introduced the following bill, which was referred to the
Committee on Consumer and Regulatory Affairs.
To adopt the Uniform Electronic Transactions Act in the District of Columbia to
validate and facilitate the use of electronic records and signatures in commercial
transactions and to authorize the Mayor to determine the extent to which District agencies
shall utilize and accept electronic records and signatures.
BE IT ENACTED BY THE COUNCIL OF THE DISTRICT OF COLUMBIA, That this act may be cited as
the "Uniform Electronic Transactions Act of 2001 "
Sec. 2. Subtitle II of Title 28 of the District of Columbia Code is amended as follows:
(a) The index is amended by adding the following at the end thereof: "48. Computer
Information Transactions . . . §§ 28-4801 to 28-4818".
(b) The following new chapter is added:
"CHAPTER 48. ELECTRONIC TRANSACTIONS; UNIFORM LAW
"Sec.
"28-4801. Definitions.
"28-4802. Scope.
"28-4803. Prospective application.
"28-4804. Use of electronic records and electronic signatures; variation by
agreement.
"28-4805. Construction and application.
"28-4806. Legal recognition of electronic records, electronic signatures, and
electronic contracts.
"28-4807. Provision of information in writing; presentation of records.
"28-4808. Attribution and effect of electronic record and electronic signature.
"28-4809. Effect of change or error.
"28-4810. Notarization and acknowledgment.
"28-4811. Retention of electronic records; originals.
"28-4812. Admissibility in evidence.
"28-4813. Automated transaction.
"28-4814. Time and place of sending and receipt.
"28-4815. Transferable records.
"28-4816. Creation and retention of electronic records and conversion of written
records by governmental agencies.
"28-4817. Acceptance and distribution of electronic records by governmental
agencies.
"28-4818. Interoperability.
"§ 28-4801. Definitions.
"In this chapter:
"(1) "Agreement" means the bargain of the parties in fact, as found in
their language or inferred from other circumstances and from rules, regulations, and
procedures given the effect of agreements under laws otherwise applicable to a particular
transaction.
"(2) "Automated transaction" means a transaction conducted or performed,
in whole or in part, by electronic means or electronic records, in which the acts or
records of one or both parties are not reviewed by an individual in the ordinary course in
forming a contract, performing under an existing contract, or fulfilling an obligation
required by the transaction.
"(3) "Computer program" means a set of statements or instructions to be
used directly or indirectly in an information processing system in order to bring about a
certain result.
"(4) "Contract" means the total legal obligation resulting from the
parties' agreement as affected by this chapter and other applicable law.
"(5) "Electronic" means relating to technology having electrical,
digital, magnetic, wireless, optical, electromagnetic, or similar capabilities.
"(6) "Electronic agent" means a computer program or an electronic or
other automated means used independently to initiate an action or respond to electronic
records or performances in whole or in part, without review or action by an individual.
"(7) "Electronic record" means a record created, generated, sent,
communicated, received. or stored by electronic means.
"(8) "Electronic signature" means an electronic sound, symbol, or
process attached to or logically associated with a record and executed or adopted by a
person with the intent to sign the record.
"(9) "Governmental agency" means an executive, legislative, or judicial
agency, department, board, commission, authority, institution, or instrumentality of the
federal government or of a State or of a county, municipality, or other political
subdivision of a State.
"(10) "Information" means data, text, images, sounds, codes, computer
programs, software, databases, or the like.
"(11) "Information processing system" means an electronic system for
creating, generating, sending, receiving, storing, displaying, or processing information.
"(12) "Person" means an individual, corporation, business trust, estate,
trust, partnership, limited liability company, association, joint venture, governmental
agency, public corporation, or any other legal or commercial entity.
"(13) "Record" means information that is inscribed on a tangible medium
or that is stored in an electronic or other medium and is retrievable in perceivable form.
"(14) "Security procedure" means a procedure employed for the purpose of
verifying that an electronic signature, record, or performance is that of a specific
person or for detecting changes or errors in the information in an electronic record. The
term includes a procedure that requires the use of algorithms or other codes, identifying
words or numbers, encryption, or callback or other acknowledgment procedures.
"(15) "State" means a State of the United States, the District of
Columbia, Puerto Rico, the United States Virgin Islands, or any territory or insular
possession subject to the jurisdiction of the United States. The term includes an Indian
tribe or band, or Alaskan native village, which is recognized by federal law or formally
acknowledged by a State.
"(16) "Transaction" means an action or set of actions occurring between
two or more persons relating to the conduct of business, commercial, or governmental
affairs.
"§ 28-4802. Scope.
"(a) Except as otherwise provided in subsection (b), this chapter applies to
electronic records and electronic signatures relating to a transaction.
"(b) This chapter does not apply to a transaction to the extent it is governed by:
"(1) A law governing the creation and execution of wills, codicils, or
testamentary trusts;
"(2) Subtitle I of this title, except for §§ 28:1-107 and 28:1-206 and Chapters
2 and 2A of Subtitle 1;
"(3) Chapter 49 of this title.
"(c) This chapter applies to an electronic record or electronic signature
otherwise excluded from the application of this chapter under subsection (b) to the extent
it is governed by a law other than those specified in subsection (b).
"(d) A transaction subject to this chapter is also subject to other applicable
substantive law.
"§28-4803. Prospective application.
'This chapter applies to any electronic record or electronic signature created,
generated, sent, communicated, received, or stored on or after the effective date of this
chapter.
"§ 28-4804. Use of electronic records and electronic signatures: variation by
agreement.
"(a) This chapter does not require a record or signature to be created, generated,
sent, communicated, received, stored, or otherwise processed or used by electronic means
or in electronic form.
"(b) This chapter applies only to transactions between parties each of which has
agreed to conduct transactions by electronic means. Whether the parties agree to conduct a
transaction by electronic means is determined from the context and surrounding
circumstances, including the parties' conduct.
"(c) A party that agrees to conduct a transaction by electronic means may refuse
to conduct other transactions by electronic means. The right granted by this subsection
may not be waived by agreement.
"(d) Except as otherwise provided in this chapter, the effect of any of its
provisions may be varied by agreement. The presence in certain provisions of this chapter
of the words "unless otherwise agreed", or words of similar import, does not
imply that the effect of other provisions may not be varied by agreement.
"(e) Whether an electronic record or electronic signature has legal consequences
is determined by this chapter and other applicable law.
"§28-4805. Construction and application.
"This chapter must be construed and applied:
"(1) To facilitate electronic transactions consistent with other applicable
law;
"(2) To be consistent with reasonable practices concerning electronic transactions
and with the continued expansion of those practices; and
"(3) To effectuate its general purpose to make uniform the law with respect to the
subject of this chapter among States enacting it.
"28-1806. Legal recognition of electronic records, electronic signatures, and
electronic contracts.
"(a) A record or signature may not be denied legal effect or enforceability solely
because it is in electronic form.
"(b) A contract may not be denied legal effect or enforceability solely because an
electronic record was used in its formation.
"(c) If a law requires a record to be in writing, an electronic record satisfies
the law.
"(d) If a law requires a signature, an electronic signature satisfies the law.
"§28-4807. Provision of information in writing; presentation of records.
"(a) If parties have agreed to conduct a transaction by electronic means and a law
requires a person to provide, send, or deliver information in writing to another person,
the requirement is satisfied if the information is provided, sent, or delivered, as the
case may be, in an electronic record capable of retention by the recipient at the time of
receipt. An electronic record is not capable of retention by the recipient if the sender
or its information processing system inhibits the ability of the recipient to print or
store the electronic record.
"(b) If a law other than this chapter requires a record (i) to be posted or
displayed in a certain manner, (ii) to be sent, communicated, or transmitted by a specified
method, or (iii) to information that is formatted in a certain manner, the following
rules apply:
"(1) The record must be posted or displayed in the manner specified in the other
law.
"(2) Except as otherwise provided in subsection (d)(2), the record must be sent.
communicated, or transmitted by the method specified in the other law.
"(3) The record must contain the information formatted in the manner specified in
the other law.
"(c) If a sender inhibits the ability of a recipient to store or print an
electronic record, the electronic record is not enforceable against the recipient.
"(d) The requirements of this section may not be varied by agreement, but:
"(1) To the extent a law other than this chapter requires information to be
provided, sent, or delivered in writing but permits that requirement to be varied by
agreement, the requirement under subsection (a) that the information be in the form of an
electronic record capable of retention may also be varied by agreement; and
"(2) A requirement under a law other than this chapter to send, communicate, or
transmit a record by first-class mail, postage prepaid, may be varied by agreement to the
extent permitted by the other law.
"§28-4808. Attribution and effect of electronic record and electronic signature.
"(a) An electronic record or electronic signature is attributable to a person if
it was the act of the person. The act of the person may be shown in any manner, including
a showing of the efficacy of any security procedure applied to determine the person to
which the electronic record or electronic signature was attributable.
"(b) The effect of an electronic record or electronic signature attributed to a
person under subsection (a) is determined from the context and surrounding circumstances
at the time of its creation, execution, or adoption, including the parties' agreement, if
any, and otherwise as provided by law.
"§28-4809. Effect of change or error.
"If a change or error in an electronic record occurs in a transmission between
parties to a transaction, the following rules apply:
"(1) If the parties have agreed to use a security procedure to detect changes or
errors and one party has conformed to the procedure, but the other party has not, and the
nonconforming party would have detected the change or error had that party also conformed,
the conforming party may avoid the effect of the changed or erroneous electronic record.
"(2) In an automated transaction involving an individual, the individual may avoid
the effect of an electronic record that resulted from an error made by the individual in
dealing with the electronic agent of another person if the electronic agent did not
provide an opportunity for the prevention or correction of the error and, at the time the
individual learns of the error, the individual:
"(A) Promptly notifies the other person of the error and that the individual did
not intend to be bound by the electronic record received by the other person;
"(B) Takes reasonable steps, including steps that conform to the other person's
reasonable instructions, to return to the other person or, if instructed by the other
person, to destroy the consideration received, if any, as a result of the erroneous
electronic record; and
"(C) Has not used or received any benefit or value from the consideration, if any,
received from the other person.
"(3) If neither paragraph (1) nor paragraph (2) applies, the change or error has
the effect provided by other law, including the law of mistake, and the parties' contract,
if any.
"(4) Paragraphs (2) and (3) may not be varied by agreement.
"28-4810. Notarization and acknowledgment.
"If a law requires a signature or record to be notarized, acknowledged, verified,
or made under oath, the requirement is satisfied if the electronic signature of the person
authorized to perform those acts, together with all other information required to be
included by other applicable law, is attached to or logically associated with the
signature or record.
"§28-4811. Retention of electronic records; originals.
"(a) If a law requires that a record be retained, the requirement is satisfied by
retaining an electronic record of the information in the record which:
"(1) Accurately reflects the information set forth in the record after it was
first generated in its final form as an electronic record or otherwise; and
"(2) Remains accessible for later reference.
"(b) A requirement to retain a record in accordance with subsection (a) does not
apply to any information the sole purpose of which is to enable the record to be sent,
communicated, or received.
"(c) A person may satisfy subsection (a) by using the services of another person
if the requirements of that subsection are satisfied.
"(d) If a law requires a record to be presented or retained in its original form,
or provides consequences if the record is not presented or retained in its original form,
that law is satisfied by an electronic record retained in accordance with subsection (a).
"(e) If a law requires retention of a check, that requirement is satisfied by
retention of an electronic record of the information on the front and back of the check in
accordance with subsection (a).
"(f) A record retained as an electronic record in accordance with subsection (a)
satisfies a law requiring a person to retain a record for evidentiary, audit, or like
purposes, unless a law enacted after the effective date of this chapter specifically
prohibits the use of an electronic record for the specified purpose.
"(g) This section does not preclude a governmental agency of the District from
specifying additional requirements for the retention of a record subject to the agency's
jurisdiction.
"§28-4812. Admissibility in evidence.
"In a proceeding, evidence of a record or signature may not be excluded solely
because it is in electronic form.
"§28-4813. Automated transaction.
"In an automated transaction, the following rules apply:
"(1) A contract may be formed by the interaction of electronic agents of the
parties, even if no individual was aware of or reviewed the electronic agents' actions or
the resulting terms and agreements.
"(2) A contract may be formed by the interaction of an electronic agent and an
individual, acting on the individual's own behalf or for another person, including by an
interaction in which the individual performs actions that the individual is free to refuse
to perform and which the individual knows or has reason to know will cause the electronic
agent to replete the transaction or performance.
"(3) The terms of the contract are determined by the substantive law applicable to
it.
"§ 28-4814. Time and place of sending and receipt.
"(a) Unless otherwise agreed between the sender and the recipient, an electronic
record is sent when it:
"(1) Is addressed properly or otherwise directed properly to an information
processing system that the recipient has designated or uses for the purpose of receiving
electronic records or information of the type sent and from which the recipient is able to
retrieve the electronic record;
"(2) Is in a form capable of being processed by that system; and
"(3) Enters an information processing system outside the control of the sender or
of a person that sent the electronic record on behalf of the sender or enters a region of
the information processing system designated or used by the recipient which is under
the control of the recipient.
"(b) Unless otherwise agreed between a sender and the recipient, an electronic
records is received when:
"(1) It enters an information processing system that the recipient has designated
or uses for the purpose of receiving electronic records or information of the type sent
and from which the recipient is able to retrieve the electronic record; and
"(2) It is in a form capable of being processed by that system.
"(c) Subsection (b) applies even if the place the information processing system is
located is different from the place the electronic record is deemed to be received under
section (d).
"(d) Unless otherwise expressly provided in the electronic record or agreed
between the sender and the recipient, an electronic record is deemed to be sent from the
sender's place of business and to be received at the recipient's place of business. For
purposes of this subsection, the following rules apply:
"(1) If the sender or recipient has more than one place of business, the place of
business of that person is the place having the closest relationship to the underlying
transaction.
"(2) If the sender or the recipient does not have a place of business, the place
of business is the sender's or recipient's residence, as the case may be.
"(e) An electronic record is received under subsection (b) even if no individual
is aware of its receipt.
"(f) Receipt of an electronic acknowledgment from an information processing system
described in subsection (b) establishes that a record was received but, by itself, does
not establish that the content sent corresponds to the content received.
"(g) If a person is aware that an electronic record purportedly sent under
subsection (a), or purportedly received under subsection (b), was not actually sent or
received, the legal effect of the sending or receipt is determined by other applicable
law. Except to the extent permitted by the other law, the requirements of this subsection
may not be varied by agreement.
"§28-4815. Transferable records.
"(a) In this section, "transferable record" means an electronic record
that:
"(1) Would be a note under Chapter 3 of Subtitle I of this title or a document
under Chapter 7 of Subtitle I of this title if the electronic record were in writing; and
"(2) The issuer of the electronic record expressly has agreed is a transferable
record.
"(b) A person has control of a transferable record if a system employed for
evidencing the transfer of interests in the transferable record reliably establishes that
person as the person to which the transferable record was issued or transferred.
"(c) A system satisfies subsection (b), and a person is deemed to have control of
a transferable record, if the transferable record is created, stored, and assigned in such
a manner that:
"(1) A single authoritative copy of the transferable record exists which is
unique, identifiable, and, except as otherwise provided in paragraphs (4), (5), and (6),
unalterable;
"(2) The authoritative copy identifies the person asserting control as:
"(A) The person to which the transferable record was issued; or
"(B) If the authoritative copy indicates that the transferable record has been
transferred, the person to which the transferable record was most recently transferred;
"(3) The authoritative copy is communicated to and maintained by the person
asserting control or its designated custodian;
"(4) Copies or revisions that add or change an identified assignee of the
authoritative copy can be made only with the consent of the person asserting control;
"(5) Each copy of the authoritative copy and any copy of a copy is readily
identifiable as a copy that is not the authoritative copy; and
"(6) Any revision of the authoritative copy is readily identifiable as authorized
or unauthorized.
"(d) Except as otherwise agreed, a person having control of a transferable record
is the holder, as defined in §28:1-201(20), of the transferable record and has the same
rights and defenses as a holder of an equivalent record or writing under Subtitle I of
this title, including, if the applicable statutory requirements under §28:3-302(a),
28:7-501, or 28:9-308 are satisfied, the rights and defenses of a holder in due course, a
holder to which a negotiable document of title has been duly negotiated, or a purchaser,
respectively. Delivery, possession, and endorsement are not required to obtain or exercise
any of the rights under this subsection.
"(e) Except as otherwise agreed, an obligor under a transferable record has the
same rights and defenses as an equivalent obligor under equivalent records or writings
under Subtitle I of this title.
"(f) If requested by a person against which enforcement is sought, the person
seeking to enforce the transferable record shall provide reasonable proof that the person
is in control of the transferable record. Proof may include access to the authoritative
copy of the transferable record and related business records sufficient to review the
terms of the transferable record and to establish the identity of the person having
control of the transferable record.
"§28-4816. Creation and retention of electronic records and conversion of written
records by governmental agencies.
"The Mayor shall determine whether, and the extent to which, a governmental agency
will create and retain electronic records and convert written records to electronic
records.
"§28-4817. Acceptance and distribution of electronic records by governmental
agencies.
"(a) Except as otherwise provided in §28-4811(f), the Mayor shall determine
whether, and the extent to which, a governmental agency will send and accept electronic
records and electronic signatures to and from other persons and otherwise create,
generate, communicate, store, process, use, and rely upon electronic records and
electronic signatures.
"(b) To the extent that a governmental agency uses electronic records and
electronic signatures under subsection (a), the Mayor, giving due consideration to
security, may specify:
"(1) The manner and format in which the electronic records must be created,
generated, sent, communicated, received, and stored and the systems established for those
purposes;
"(2) If electronic records must be signed by electronic means, the type of
electronic signature required, the manner and format in which the electronic signature
must be affixed to the electronic record, and the identity of, or criteria that must be
met by, any third party used by a person filing a document to facilitate the process;
"(3) Control processes and procedures as appropriate to ensure adequate
preservation, disposition, integrity, security, confidentiality, and auditability of
electronic records; and
"(4) Any other required attributes for electronic records which are specified for
corresponding nonelectronic records or reasonably necessary under the circumstances.
"(c) Except as otherwise provided in §28-4811(f), this chapter does not require a
governmental agency of the District to use or permit the use of electronic records or
electronic signatures.
"§28-4818. Interoperability.
"The Mayor, in adopting standards pursuant to § 28-4817, may encourage and
promote consistency and interoperability with similar requirements adopted by other
governmental agencies of this and other States and the federal government and
nongovernmental persons interacting with governmental agencies of the District. If
appropriate, those standards may specify differing levels of standards from which
governmental agencies of the District may choose in implementing the most appropriate
standard for a particular application."
Sec. 3. Fiscal impact statement.
The Council adopts the fiscal impact statement in the committee report as the fiscal
impact statement required by section 602(c)(3) of the District of Columbia Home Rule Act,
approved December 24, 1973 (87 Stat. 813; D.C. Code §1-233(c)(3)).
Sec. 4. Effective date.
This act shall take effect after following approval by the Mayor (or in the event of a
veto by the Mayor, action by the Council to override of the veto), approval by the
Financial Responsibility and Management Assistance Authority as provided in section 203(a)
of the District of Columbia Financial Responsibility and Management Assistance Act of
1995, approved April 17, 1995 (109 Stat. 116; D.C. Code §47-392.3(a)), a 30-day period of
Congressional review as provided in section 602(c)(1) of the District of Columbia Home
Rule Act, approved December 24, 1973 (87 Stat. 813; D.C. Code §1-233(c)(1)), and
publication District of Columbia Register. |
