Question

Explain the sources of contract law relating to e-contracts, including the Uniform Electronic Transactions Act(UETA), E-SIGN Act, and the Principles of the Law of Software Contracts.

Answer 1

Sources of contract law relating to e-contracts are:

1. Common law: The body of law derived from judicial decisions, rather than from statutes or constitutions. It is also called case law.

2. Restatement (Second) of Contracts: One of several influential treaties published by the American Law Institute describing the law in a given area and guiding its development.

3. Uniform Commercial Code (UCC): Uniform Commercial Code (UCC) laws are established to regulate sales of personal property and other business transactions. For example, transactions such as borrowing money, leasing equipment or vehicles, setting up contracts, and selling goods are all covered by the Uniform Commercial Code

4. Uniform Electronic Transactions Act (UETA):  The purpose of UETAis to harmonize state laws concerning the retention of paper records (especially checks) and the validity of electronic signatures.

5. E-Sign Act: The E-Sign Act is a federal law passed in 2000. It grants legal recognition to electronic signatures and records if all parties to a contract choose to use electronic documents and to sign them electronically.

6. Principles of the Law of Software Contracts: The final draft of the Principles of the Law of Software Contracts ("Principles") was unanimously approved by the American Law Institute membership in May of 2009. The goal of the project is to “clarify and unify the law of software transactions.” However, the Principles will not become law in any jurisdiction unless and until a court adopts them, so only time will tell whether the project will accomplish this goal. Nevertheless, one thing is certain. The current law of software transactions, a mish-mash of common law, Article 2 of the Uniform Commercial Code, and federal intellectual property law, among other things, is in dire need of improvement. This should not be a surprise. Most of the bodies of law that courts draw upon to decide software contract cases predate software and are not responsive to its needs. But software transactions are too important to be relegated to a second-hand legal-subject-matter status.