Is a faxed document legally binding is a question asked by many business owners. Fax machines are widely used communication tools in the legal and business sectors. Faxed copies of documents are neither a copy of the original nor the original itself. As such, it is not entirely certain whether faxed documents are legally binding or not.

Fax is short for facsimile, meaning an electronically reproduced image of a document transmitted over phone lines from the sender to a recipient. Fax machines were made commercially available by the Xerox Corporation in 1964 but gained widespread use in the 1970s when they became more affordable.

Legality of Faxed Documents

When it comes to business and financial issues, the legality of faxed documents depends on the particular use, case, state, jurisdiction, and the parties involved.

Many lenders now view faxed documents as sufficient for completing a contract. However, the use of fax machines is on the decline and may soon become obsolete due to the increasing use of digital signatures on documents.

Digital Signatures

Digital signatures allow borrowers to review, sign, and send documents online, thus avoiding the need to print the document and add “wet” signatures.

E-signatures, especially those that comply with laws governing electronic signatures, have built-in anti-fraud technologies that help protect the theft, appropriation, or misuse of electronic signatures.

As such, the only way to create trusted contracts is through the use of secure digital signatures that contain anti-fraud technology components which create full auditable trails.

The legality of a faxed document is usually determined by the parties involved in the legal/business dealing. They may decide that a faxed copy of the document is as legal as the original and serve the same purpose.

Faxed, scanned, and emailed documents (including PDF files) can generally be used in legal proceedings. Since they can be used to enforce contractual obligations, recipients can rely on them.

Acceptability of Faxed Documents

For governmental agencies, faxed copies are usually not acceptable if a legal document needs to be filed. This is because filing or recording agencies only accept documents that contain original signatures.

This means that if there is the possibility that individuals need to submit a legal document to a government agency, they need to obtain original signed copies. However, faxed or emailed copies are acceptable if the reason for creating the document is to enforce a contract.

In most states, legal agreements or contracts that contain a faxed or photocopied signature are valid and enforceable. Such documents can be used to prove a contract's existence during administrative proceedings or in a court of law.

The Validity of “Dry” Signatures

If the validity of the signature is questioned, the original document can help verify the conformity of the faxed or copied signature. However, a copied or faxed signature may not be appropriate in all cases. For instance, a registrar of deeds or a county recorder's office usually requires original signatures on a memorandum of lease or a deed before they can file such documents.

Also, jurisdictions that recognize the validity of cognovits notes usually require that the note contains the maker's signature in order to obtain judgments from the court.

Scanned or faxed copies of originals may not be accepted by some establishments, agencies, or institutions. This is true for processes or transcripts that were completed by government agencies.

To successfully protect their confidential data, all companies would prefer to use secure communication tools. Although most methods of transmitting documents come with some level of risk, faxing is more secure than most.

The Authenticity of Faxed Documents

Although interception is possible, it is extremely difficult to tamper or interfere with telephone line transmissions. As such, the authenticity of a faxed document is usually not questioned.

Cloud Faxing

There is also an alternate means of faxing documents called cloud faxing. It automatically encrypts documents before, during, and after transmission. This provides another layer of protection and is more cost-effective than conventional fax machines.

Another benefit of using fax machines is the speed. The receiver gets to receive a printed copy of the document almost instantaneously. Cloud faxing also provides delivery receipts containing time and date stamps to the sender.

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