Download Zipped Enrolled WP 8.0 SB0125.ZIP 16,852 Bytes
[Introduced][Amended][Status][Bill Documents][Fiscal Note][Bills Directory]
S.B. 125 Enrolled
AN ACT RELATING TO ESTABLISHING CRITERIA, PROCEDURES, AND LEGAL
STANDARDS GOVERNING ELECTRONIC TRANSACTIONS; AUTHORIZING STATE
AGENCIES TO MAKE RULES DEFINING TRANSACTIONS THAT WILL AND WILL NOT
BE CONDUCTED ELECTRONICALLY; REQUIRING STATE AGENCIES TO COMPLY
WITH EXISTING RECORD RETENTION REQUIREMENTS; AND AUTHORIZING THE
CHIEF INFORMATION OFFICER TO PREPARE MODEL RULES AND STANDARDS TO
ASSIST STATE AGENCIES.
This act affects sections of Utah Code Annotated 1953 as follows:
ENACTS:
46-4-101, Utah Code Annotated 1953
46-4-102, Utah Code Annotated 1953
46-4-103, Utah Code Annotated 1953
46-4-104, Utah Code Annotated 1953
46-4-105, Utah Code Annotated 1953
46-4-106, Utah Code Annotated 1953
46-4-201, Utah Code Annotated 1953
46-4-202, Utah Code Annotated 1953
46-4-203, Utah Code Annotated 1953
46-4-204, Utah Code Annotated 1953
46-4-205, Utah Code Annotated 1953
46-4-301, Utah Code Annotated 1953
46-4-302, Utah Code Annotated 1953
46-4-401, Utah Code Annotated 1953
46-4-402, Utah Code Annotated 1953
46-4-403, Utah Code Annotated 1953
46-4-501, Utah Code Annotated 1953
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 46-4-101 is enacted to read:
46-4-101. Title.
This chapter is known as the "Uniform Electronic Transactions Act."
Section 2. Section 46-4-102 is enacted to read:
46-4-102. Definitions.
As used 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) (a) "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.
(b) "Security procedure" includes a procedure that requires the use of algorithms or other
codes, identifying words or numbers, encryption, or callback or other acknowledgment procedures.
(15) (a) "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.
(b) "State" includes an Indian tribe or band, or Alaskan native village, that 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.
Section 3. Section 46-4-103 is enacted to read:
46-4-103. Scope.
(1) Except as otherwise provided in Subsection (2), this chapter applies to electronic records
and electronic signatures relating to a transaction.
(2) This chapter does not apply to:
(a) a transaction to the extent it is governed by a law governing the creation and execution
of wills, codicils, or testamentary trusts;
(b) Title 70A, Uniform Commercial Code, other than:
(i) Sections 70A-1-107 and 70A-1-206 ; and
(ii) Title 70A, Chapter 2, and Title 70A, Chapter 2a.
(3) This chapter applies to an electronic record or electronic signature otherwise excluded
from the application of this chapter under Subsection (2) to the extent it is governed by a law other
than those specified in Subsection (2).
(4) A transaction subject to this chapter is also subject to other applicable substantive law.
(5) Nothing in this chapter requires any county recorder to accept for recording any
instrument in electronic form.
Section 4. Section 46-4-104 is enacted to read:
46-4-104. Prospective application.
This chapter applies to any electronic record or electronic signature created, generated, sent,
communicated, received, or stored on or after May 1, 2000.
Section 5. Section 46-4-105 is enacted to read:
46-4-105. Use of electronic records and electronic signatures -- Variation by agreement.
(1) 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.
(2) (a) This chapter applies only to transactions between parties each of which has agreed to
conduct transactions by electronic means.
(b) Whether or not the parties agree to conduct a transaction by electronic means is
determined from the context and surrounding circumstances, including the parties' conduct.
(3) (a) A party that agrees to conduct a transaction by electronic means may refuse to
conduct other transactions by electronic means.
(b) The right granted by this Subsection (3)(a) may not be waived by agreement.
(4) (a) Except as otherwise provided in this chapter, the effect of any of its provisions may
be varied by agreement.
(b) 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.
(5) Whether an electronic record or electronic signature has legal consequences is determined
by this chapter and other applicable law.
Section 6. Section 46-4-106 is enacted to read:
46-4-106. 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 the states enacting it.
Section 7. Section 46-4-201 is enacted to read:
46-4-201. Legal recognition of electronic records, electronic signatures, and electronic
contracts.
(1) A record or signature may not be denied legal effect or enforceability solely because it
is in electronic form.
(2) A contract may not be denied legal effect or enforceability solely because an electronic
record was used in its formation.
(3) If a law requires a record to be in writing, an electronic record satisfies the law.
(4) If a law requires a signature, an electronic signature satisfies the law.
Section 8. Section 46-4-202 is enacted to read:
46-4-202. Provision of information in writing -- Presentation of records.
(1) (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.
(b) 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.
(2) If a law other than this chapter requires a record to be posted or displayed in a certain
manner, to be sent, communicated, or transmitted by a specified method, or to contain information
that is formatted in a certain manner, the following rules apply:
(a) the record must be posted or displayed in the manner specified in the other law;
(b) except as otherwise provided in Subsection (4)(b), the record must be sent,
communicated, or transmitted by the method specified in the other law; and
(c) the record must contain the information formatted in the manner specified in the other
law.
(3) 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.
(4) The requirements of this section may not be varied by agreement, but:
(a) 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 (1) that the information be in the form of an electronic record capable of retention may
also be varied by agreement; and
(b) a requirement under a law other than this chapter to send, communicate, or transmit a
record by first-class mail, postage prepaid or regular United States mail, may be varied by agreement
to the extent permitted by the other law.
Section 9. Section 46-4-203 is enacted to read:
46-4-203. Attribution and effect of electronic record and electronic signature.
(1) (a) An electronic record or electronic signature is attributable to a person if it was the act
of the person.
(b) 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.
(2) The effect of an electronic record or electronic signature attributed to a person under
Subsection (1) 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.
Section 10. Section 46-4-204 is enacted to read:
46-4-204. Effect of change or error.
(1) If a change or error in an electronic record occurs in a transmission between parties to
a transaction, the following rules apply:
(a) 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.
(b) 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:
(i) 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;
(ii) 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
(iii) has not used or received any benefit or value from the consideration, if any, received
from the other person.
(2) If neither Subsection (1)(a) or (b) applies, the change or error has the effect provided by
other law, including the law of mistake, and the parties' contract, if any.
(3) Subsections (1)(b) and (2) may not be varied by agreement.
Section 11. Section 46-4-205 is enacted to read:
46-4-205. Notarization and acknowledgment.
If a law requires a signature or record to be notarized, acknowledged, verified, or made under
oath, the requirement is satisfied by following the procedures and requirements of Subsection
46-1-16 (7).
Section 12. Section 46-4-301 is enacted to read:
46-4-301. Retention of electronic records -- Originals.
(1) If a law requires that a record be retained, the requirement is satisfied by retaining an
electronic record of the information in the record that:
(a) 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
(b) remains accessible for later reference.
(2) A requirement to retain a record in accordance with Subsection (1) does not apply to any
information the sole purpose of which is to enable the record to be sent, communicated, or received.
(3) A person may satisfy Subsection (1) by using the services of another person if the
requirements of Subsection (1) are satisfied.
(4) 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 (1).
(5) 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
(1).
(6) A record retained as an electronic record in accordance with Subsection (1) satisfies a law
requiring a person to retain a record for evidentiary, audit, or like purposes, unless a law enacted after
May 1, 2000, specifically prohibits the use of an electronic record for the specified purpose.
(7) This section does not preclude a governmental agency from specifying additional
requirements for the retention of a record subject to the agency's jurisdiction.
Section 13. Section 46-4-302 is enacted to read:
46-4-302. Admissibility in evidence.
In a proceeding, evidence of a record or signature may not be excluded solely because it is
in electronic form.
Section 14. Section 46-4-401 is enacted to read:
46-4-401. 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 complete the transaction or
performance.
(3) The terms of the contract are determined by the substantive law applicable to it.
Section 15. Section 46-4-402 is enacted to read:
46-4-402. Time and place of sending and receipt.
(1) Unless otherwise agreed between the sender and the recipient, an electronic record is sent
when it:
(a) 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;
(b) is in a form capable of being processed by that system; and
(c) 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 that is under the control of the recipient.
(2) Unless otherwise agreed between a sender and the recipient, an electronic record is
received when:
(a) 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
(b) it is in a form capable of being processed by that system.
(3) Subsection (2) 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 Subsection (4).
(4) (a) 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.
(b) For purposes of this Subsection (4), the following rules apply:
(i) 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.
(ii) 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.
(5) An electronic record is received under Subsection (2) even if no individual is aware of
its receipt.
(6) Receipt of an electronic acknowledgment from an information processing system
described in Subsection (2) establishes that a record was received but, by itself, does not establish that
the content sent corresponds to the content received.
(7) (a) If a person is aware that an electronic record purportedly sent under Subsection (1),
or purportedly received under Subsection (2), was not actually sent or received, the legal effect of
the sending or receipt is determined by other applicable law.
(b) Except to the extent permitted by the other law, the requirements of this Subsection (7)
may not be varied by agreement.
Section 16. Section 46-4-403 is enacted to read:
46-4-403. Transferable records.
(1) As used in this section, "transferable record" means an electronic record that:
(a) would be a note under Title 70A, Chapter 3, or a document under Title 70A, Chapter 7,
if the electronic record were in writing; and
(b) the issuer of the electronic record expressly has agreed is a transferable record.
(2) 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.
(3) A system satisfies Subsection (2), 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:
(a) a single authoritative copy of the transferable record exists that is unique, identifiable, and,
except as otherwise provided in Subsections (3)(d), (e), and (f), unalterable;
(b) the authoritative copy identifies the person asserting control as:
(i) the person to which the transferable record was issued; or
(ii) if the authoritative copy indicates that the transferable record has been transferred, the
person to which the transferable record was most recently transferred;
(c) the authoritative copy is communicated to and maintained by the person asserting control
or its designated custodian;
(d) 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;
(e) 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
(f) any revision of the authoritative copy is readily identifiable as authorized or unauthorized.
(4) (a) Except as otherwise agreed, a person having control of a transferable record is the
holder, as defined in Subsection 70A-1-201 (20), of the transferable record and has the same rights
and defenses as a holder of an equivalent record or writing under Title 70A, Uniform Commercial
Code, including, if the applicable statutory requirements under Subsection 70A-3-302 (1), Section
70A-7-501 , or Section 70A-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.
(b) Delivery, possession, and indorsement are not required to obtain or exercise any of the
rights under Subsection (4)(a).
(5) 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 Title 70A, Uniform
Commercial Code.
(6) (a) 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.
(b) 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.
Section 17. Section 46-4-501 is enacted to read:
46-4-501. Creation and retention of electronic records and conversion of written
records by governmental agencies.
(1) A state governmental agency may, by following the procedures and requirements of Title
63, Chapter 46a, Utah Administrative Rulemaking Act, make rules that:
(a) identify specific transactions that the agency is willing to conduct by electronic means;
(b) identify specific transactions that the agency will never conduct by electronic means;
(c) specify the manner and format in which electronic records must be created, generated,
sent, communicated, received, and stored, and the systems established for those purposes;
(d) if law or rule requires that the electronic records must be signed by electronic means,
specify 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;
(e) specify control processes and procedures as appropriate to ensure adequate preservation,
disposition, integrity, security, confidentiality, and auditability of electronic records; and
(f) identify any other required attributes for electronic records that are specified for
corresponding nonelectronic records or that are reasonably necessary under the circumstances.
(2) A state governmental agency that makes rules under this section shall submit copies of
those rules, and any amendments to those rules, to:
(a) the chief information officer established by Section 63D-1-301 ; and
(b) the Utah Information Technology Commission established by Section 63D-1-202 .
(3) (a) The chief information officer may prepare model rules and standards relating to
electronic transactions that encourage and promote consistency and interoperability with similar
requirements adopted by other Utah government agencies, other states, the federal government, and
nongovernmental persons interacting with Utah governmental agencies.
(b) In preparing those model rules and standards, the chief information officer may specify
different levels of standards from which governmental agencies may choose in order to implement
the most appropriate standard for a particular application.
(c) Before submitting any model rules or standards to state governmental agencies for their
adoption as permanent rules, the chief information officer shall submit the model rules and standards
to the Utah Information Technology Commission for its review and suggestions.
(d) Nothing in this Subsection (3) requires a state agency to use the model rules and
standards prepared by the chief information officer when making rules under this section.
(4) Except as provided in Subsection 46-4-301 (6), nothing in this chapter requires any state
governmental agency to:
(a) conduct transactions by electronic means; or
(b) use or permit the use of electronic records or electronic signatures.
(5) Each state governmental agency shall:
(a) establish record retention schedules for any electronic records created or received in an
electronic transaction according to the standards developed by the Division of Archives under
Subsection 63-2-901 (2)(e); and
(b) obtain approval of those schedules from the State Records Committee as required by
Subsection 63-2-502 (1)(b).
[Bill Documents][Bills Directory]