It’s finally here – signing day for your transaction. The document may be in your email (or sent by an electronic signature application) and ready for your signature. So perhaps signing is as easy as a simple click. Or maybe the printed paper agreement is laying on your desk or sitting in front of you at the signing table.
Is it the right document to sign?
How do you know? What do you do? Email and electronic signature applications like DocuSign have made it very easy to send documents for signature. But, there may be other versions – in your email or on the electronic signature application – that are not acceptable. Or possibly someone innocently (or not) made a change to the version that you read – and that you thought was the only version. Technology has made it easy to make document changes that might be very subtle and hard to spot. Fortunately, technology also provides solutions with robust document comparison (or “redlining“) software to compare versions.
There is a necessary step before signing that we call document “verification.” This “verification” step means that measures are taken to ensure that the document is the agreed upon version that is intended to be signed. Verification can be approached in three ways – you do it, you trust one of your team members to do it, or you trust someone else to do it.
You can ensure it’s the correct version yourself. For a very simple agreement this means reading it carefully. Again. For a more complex document, if you have access to the “correct” version then you can compare them – either manually or using comparison software. If you have a printed paper document in front of you, there will scanning and perhaps character recognition (OCR) required before comparison software will be helpful. It will take some effort, but it needs to be done.
Alternatively, you can trust someone on your team to check the version, and in a major transaction this will likely be your legal counsel. They will follow the steps in the prior paragraph to complete the “verification” and it will take time and incur costs. Other team members can be given this responsibility – if you’re confident in their attention to detail.
What if one of these verification approaches isn’t practical? For example, the printed paper document sits in front of you ready to be signed while someone impatiently waits. Without scanning and converting that document and taking the time to run the right comparisons, or without someone you trust assuring you that it is absolutely correct, there may be a cloud of uncertainty about whether this document is the one that you should sign. And sometimes people disregard the uncertainty and take that chance.
You might suggest that you print and sign the version that you know is correct and then send it to the other party. But then the other party will have the same uncertainty. And what if each party prints and signs what they think is the final version, but each signs a different version. Everyone then delivers their version to the other party to conclude the deal and no one notices that the signed documents are different. You can’t say that will never happen . . .
Another approach is to rely on a neutral party (or a technology platform like Transaction Commons) to coordinate the exchange of document versions. When all parties confirm that one version is ready for signature, that version – the “verified version” – is marked accordingly and made available to all parties in a non-alterable format. Then all parties can print the verified document and sign it with confidence.
While document verification before signing can be approached superficially, or not considered necessary at all, its is a risk. And especially for a significant transaction, signing the wrong document is never acceptable.