When Paul, a freelancer based in New York, couldn’t get a response from a consulting client who owed him money, he thought he might have to take legal action. I’ll download the contract, he thought, as he dug back through his inbox for a link to the document he had signed months before using business automation vendor HelloSign.
But when he clicked to open the contract, all he got was an error message. The contract was gone. There was no way to prove the client owed him money.
The situation reveals a weak spot in our cloud computing world, in which we store documents online indefinitely without necessarily having the digital backups or hard copies we may someday need to reference. The cloud, it turns out, is only convenient until the documentation you need disappears.
Paul, who requested his last name be withheld, said it took about a week to figure out the right avenue to get help from HelloSign. Finally, a company employee confirmed that the contract had been deleted two months after Paul had signed it. Paul was supposed to get an email notification when the client deleted the contract, but he says none ever arrived.
Not only had the contract been deleted — it also had never been signed by the client at all. “Cancelling the request before all signers have completed their portions immediately cancels the contract and all copies are deleted,” read the email explanation Paul got from HelloSign. “Unfortunately, the document is no longer retrievable.”
When a cloud contract vanishes, records remain
HelloSign, which was recently acquired by Dropbox, wouldn’t comment on Paul’s experience and said the contracts it facilitates and the storage of those documents are the business “solely between the parties in a transaction,” according to a company spokesperson.
I reached out to several other companies that offer electronic signature services to see if their policies match up with those of HelloSign.
Adobe Sign, formerly Echosign, said it provides a “comprehensive audit trail that is beyond the sender’s reach”, and in some cases automatically emails copies of documents at each stage of the signing process.
At DocuSign, the sender of the agreement can choose to delete the document from the system, but doing so notifies all signers, who have a chance to download a local copy before that deletion occurs, Ryan Cox, vice president of platform product management at DocuSign, explained by email. After a document is “purged”, a record of its existence remains.
“Think of how the post office would maintain delivery history and related data for a package, even if the package has been delivered/destroyed/whatever,” Cox said.
Why did the freelancer do the job if the contract was never completed? Paul said he had worked with the client before, and they were always reliable. After he signed his part of the document, his contact at the company said by email they had received it and he could get started on the work.
His payment was being processed when we spoke last week, but the company only responded to his repeated phone and email inquiries after he threatened to file a Freelance Isn’t Free complaint with New York City Department of Consumer Affairs. That legislation does not require proof of a formal contract in order to file a claim for nonpayment.
Now, Paul has his guard up. “I do not have any trust that [electronic signature vendors] will store the contract. So the next time I use one I’m going to go in and download PDFs of the contract,” Paul said. He said he has downloaded copies of all his old contracts signed with HelloSign and DocuSign.
How to protect your electronically signed contracts
Paul’s story is a warning not to get complacent about documents you have hanging out in the cloud, especially if they’re controlled by another party. Whether it’s a freelance work agreement, the lease for your apartment, or you signed up to refinance a loan, downloading copies of your electronically signed documents should be an “early and often” task you complete.
When an agreement requires signatures from multiple parties, don’t assume the signing process will be complete immediately after you do your part. Depending on who you’re doing business with, having a signed and sealed contract on the books may not be at the top of their to-do list.
As mentioned in a recent article from Lifehacker Senior Technology Editor David Murphy, if you’re digitising your family photos, you don’t just save them on one cloud service — you also make a local copy in case something goes wrong. And you keep the originals somewhere safe, too.
Contracts may not be as sentimental as family photos, but legal and financial matters deserve to be treated with the same caution. Consider the copy that lives on the electronic signature site to be a backup.