Simon PLC Attorneys & Counselors – May 2026 Memorandum
Out of the Ether – Is an Agreement That Exists Only Electronically as Enforceable as a Traditional Signed Paper Document?
Troy, MI. The federal Electronic Signatures in Global and National Commerce Act (E-Sign Act) went into effect back in 2001. This statute makes feasible the use of electronic records and signatures in interstate and foreign commerce by ensuring the validity and legal effect of contracts entered into electronically. The primary focus of this enactment is to ensure contracts executed via electronic means are given the same validity and authority as their paper counterparts. Under the E-Sign Act, an electronic signature is broadly defined as any mark or sound.
For its part, Michigan has also adopted legislation providing for the enforcement of electronically executed agreements and contracts. Known as the Michigan Uniform Electronic Transactions Act, MCL 450.831 et seq., or UETA, it establishes rules and procedures governing electronic transactions. Among other things, the UETA establishes a legal foundation for utilizing electronic communications and record when the parties have agreed to deal electronically. The UETA is designed to foster electronic commerce by placing electronic and paper-based agreements on the same legal footing.
Having established that a document existing solely in the realm of bits and bytes can constitute a valid agreement under federal and Michigan law, what factors or parol evidence, if any, must be considered by a reviewing court to determine whether or not an electronic contract was indeed executed and should be given binding effect? What, exactly, constitutes an electronic “signature” and can same effectively be disclaimed?
The recent case of Borsand Family Foundation, Inc., et al. v. Woodward Avenue Group, LLC, et al., unpublished, Court of Appeals, issued November 4, 2025 (Docket Nos. 368456; 369201) is instructive: Borsand arises from an agreement between neighboring landowners regarding, among other things, a parking easement placement of a dumpster. Consideration for the agreement included waiver of Woodward Avenue’s objection to Borsand’s petition for grant of a special use permit from the township, allowing Borsand’s tenant to operate a synagogue on its property.
Following the township’s grant of the special use permit, partly conditional upon the agreement of the parties, extensive negotiations ensued with the end result being reduced to a detailed multi-point email in June 2019 by Woodard Avenue’s sole member. Borsand’s counsel responded the following day with an email of his own stating “The terms you noted below are correct.” After further discussion, Borsand’s counsel again confirmed his clients’ agreement in an email and, point-by-point, indicated assent on behalf of his clients as to each of the enumerated terms.
Negotiations eventually stalled, and no formal written document was ever executed. In June 2020, Borsand notified Woodward Avenue that it would no longer share the cost of waste removal services and demanded that Woodward Avenue remove the dumpster from its property. By May of 2022, the parties’ relationship deteriorated further, with Borsand ultimately filing suit for trespass based on Woodward Avenue’s continued use of the dumpster. Woodward Avenue counterclaimed, alleging breach of contract and seeking specific performance of the email agreement and declaratory relief. Following a three-day bench trial, the trial court ruled in Woodward Avenue’s favor, concluding that the parties had entered into a binding contract, constituted solely by the June 2019 email exchanges, despite the inclusion of a disclaimer in Borsand’s attorney’s emails that the sender’s printed name therein was not to be construed as a signature.
The Court of Appeals upheld the trial court’s findings based on the UETA and the parties’ conforming conduct: Under the UETA, “[i]f a law requires a signature, an electronic signature satisfies the law.” MCL 450.837(4). The statute defines an electronic signature as “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.” MCL 450.832(h).
Regarding Borsand’s contention that the disclaimer controls and prevents the court from treating the email as an electronic signature, the Appeals Court stated: “We do not read the statute in this fashion. Nothing in the statute establishes a per se rule that boilerplate disclaimers control or that they override the substance of the communication itself. To the contrary, the comments to the UETA observe that ‘[w]hether any particular record is ‘signed’ is a question of fact.’ Proof of that fact must be made under other applicable law.” The UETA merely assures that such signature may be denoted through electronic means.
The parties’ course of dealing was also an important factor: Borsand’s counsel unequivocally confirmed that “[t]he terms you noted below are correct.” He also insisted that no agreement was needed because the emails were themselves binding, which effectively discouraged efforts to reduce the agreement to a formal document. “Taken together, those actions reasonably demonstrated adoption of the emails with intent to sign. The trial court’s finding that the emails were electronically signed was not clearly erroneous.”
While it is possible to for Michigan businesses to create and execute enforceable electronic contracts, it is nevertheless important for anyone doing business within the digital realm to consult with a Michigan contracts attorney familiar with the laws governing e-commerce and electronic transactions to ensure that its electronic agreements will be upheld in the same manner as more traditional, paper-based documents. We at Simon PLC Attorneys & Counselors are well versed in all aspects of contract law and stand ready to assist you with drafting and enforcement of all types of agreements, electronic or paper.
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