Thank you for sharing!

Your article was successfully shared with the contacts you provided.
Riding on the heels of the recently adopted federal E-Sign Act, CyberCrop.com has become the first online cash grain exchange to offer legally binding electronic signatures for contract transactions over the internet. The site, slated to start serving Minnesota later this month, is already up and running in Kansas and Nebraska, and is expected to roll into Iowa and South Dakota later this month. Several states that CyberCrop hoped to enter by now still have stringent regulations that do not afford electronic contracts the same legal effect and enforceability of paper contracts. The company worked exclusively with attorneys at Hogan and Hartson of Boulder, Colorado, to create the online legal contract. Citing attorney-client confidentiality, CyberCrop officials would not comment on how they pioneered the online contract. Cybercrop.com promises to be a major new tool in price discovery for producers, helping them shop for the best grain prices within a 300-mile radius, and then clinching the bargains on-line. According to Brent Gwaltney, vice-president of finance for CyberCrop.com, the Minnesota arrangement would become first agricultural site to authorize all transactions through a legal contract, authenticated by electronic signature. The signature is validated by two separate pass codes — one from the buyer and the other from the seller, or grower. With both pass codes entered, the parties can complete their transaction electronically. “[With] most other sites, usually the grain buyer and seller would agree to a price over the phone, [and] the process would usually take weeks to complete,” Gwaltney said. “After they agreed on a price, each would have to satisfy their contract through their own legal avenues — which also took some time. Here it just takes a click of the mouse.” Gwaltney said while there are two other Internet bidding post services in existence, Ice.com and Rooster.com, “We’re the only one, to our knowledge, who can electronically satisfy the contract.” CHANGING THE FACE OF E-COMMERCE The E-Sign Act, effective October 1, puts into a place an interim national standard for the acceptance of electronic signatures and records until all states adopt laws based on the Uniform Electronic Transactions Act. Under E-Sign, an electronic signature cannot be denied validity if it is “an electronic sound, symbol or process, attached to or logically associated with a contract or record, and executed or adopted by a person with the intent to sign the record.” Jeremiah S. Buckley, counsel for the Electronic Financial Services Council and a partner at Goodwin, Procter and Hoar in Washington, D.C., lobbied for the new E-Sign legislation. He said the law would effectively change the face of e-commerce. “In some ways, I think that the electronic signature act will set a standard for how to conduct business and authorize it on a national level,” Buckley said. “It will certainly stimulate an activity in e-commerce. I think that it spells out the rules, which will balance themselves out in time.” Buckley further said the act would have a huge impact legally. “I think the statute is a self-effectuating statute,” he said. “It’s not without areas that could use more clarity … It has a broad outline of rules, and some of those will develop in the market place. I think it is going to be a step-by-step process.” Buckley warned of a potential pitfall of the E-Sign Act: some lawyers could temporarily lose work. “There may be an impact on some legal business,” he said. “On the other hand, there will be a new common law of commerce, and there will be more work for attorneys as these laws are effectuated and evolved.” Gwaltney said Cybercrop.com hopes to establish itself in as many as 15 agricultural states this fall.

This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.

To view this content, please continue to their sites.

Not a Lexis Advance® Subscriber?
Subscribe Now

Not a Bloomberg Law Subscriber?
Subscribe Now

Why am I seeing this?

LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.

For questions call 1-877-256-2472 or contact us at [email protected]


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.