Electronic Filing and the Demise of the Original Signature

Journal Issue

May 2003

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Federal courts are now rapidly implementing the
CM/ECF (Case Management/Electronic Case Files) program to replace older
case-management systems such as BANCAP and NIBS. This new program offers
efficiency for both the courts and practitioners. It updates the architecture
and functionality of the older systems, which are reaching obsolescence. It
provides electronic filing capability and Internet access to court files on a
24-hour basis and gives attorneys practicing at a distance from the court significantly
improved access. In addition it provides registered users with immediate
notification of filings occurring in cases in which they represent parties.

These
innovations create the possibility for significant change in legal practice and
procedure, and these changes may induce a form of legal culture shock if not
appropriately managed. One of the areas causing significant controversy is the
demise of court files containing documents with original signatures. CM/ECF has
the potential for creating a legal environment in which virtual documents will
entirely replace paper files. Since it is possible, some courts have embraced
the opportunity. The paperless court concept is quickly becoming an operative
reality in those courts. In others, an effort is being made to retain documents
with original signatures without sacrificing most advantages of paperless file
management.

In
traditional legal practice, signatures perform two basic functions. The most
obvious is that the signature authenticates the document, i.e., it creates a verifiable link between a document and
the filing party. The other function is content verification. In this regard,
the signature acts as a certification ensuring that the documents have been
reviewed and that the content meets certain standards. The most obvious is that
the factual allegations made are true and correct. Federal Rule of Bankruptcy
9011(a) provides that "every petition, pleading, written motion or other
paper...shall be signed by an attorney or by the filing party if not
represented." Petitions, lists, schedules, statements and amendments
thereto must be verified.<a href="#1" name="1a">1</a> In addition, the signing, filing or submitting of
pleadings and motions act as a certification (inter alia) that a document has been reviewed by the party, that
there is some support for the factual allegations and positions taken and that
the document has not been presented for an improper purpose.<a href="#2" name="2a">2</a> Since contents of
pleadings found to violate these standards may subject the filing party to
sanctions,<a href="#3" name="3a">3</a> there is a need to clearly identify the person who signed or
presented the documents for filing.

<blockquote><blockquote>
<hr>
<big><center>
It is becoming more common for courts to accept paper
pleadings with no signature or with a facsimile signature without a
corresponding requirement that the original document be later filed.
</center></big>
<hr>
</blockquote></blockquote>

This
is more than a theoretical problem. In the real world, fraud does occur, and
modern technology makes it relatively easy to replicate a facsimile signature
and use it to create fraudulent documents.<a href="#4" name="4a">4</a> In
addition, debtors have been known to allege that their signatures on the
petition, schedules or other documents have been forged.<a href="#5" name="5a">5</a> As a result, many
bankruptcy courts will not accept pleadings for filing without original
signatures despite the language in <a href="http://www.westlaw.com/find/default.wl?rs=CLWD3.0&vr=2.0&cite=F…
9011(a)</a>, which suggests that unsigned pleadings should be accepted and then
stricken if the document is not promptly corrected.<a href="#6" name="6a">6</a> In a survey recently done
of bankruptcy clerks (hereinafter "2003 survey"), 15 of the 37
clerks indicated that their courts do not accept pleadings without original
signatures. Those courts that require original signatures almost certainly do so
because of the belief that they provide greater evidentiary value should
signature forgery be suspected or alleged.

There
is clearly concern that in a prosecution involving alleged bankruptcy fraud,
the attorney may be required to introduce an original document to meet the
requirements of the "best evidence" rule.<a href="#7" name="7a">7</a> There may also be
concern that original signatures will provide a better basis for handwriting
analysis should expert opinion be needed to establish the authenticity of a
signature. It is not at all clear that imaged documents will not suffice in
such prosecutions, but if these concerns are valid, they are not being
articulated on a national level by the Department of Justice, the agency most
likely to have an interest in such matters. In the 2003 survey, only two of the
responding courts indicated that there was any active opposition to proposed
CM/ECF rules from either the Office of the U.S. Trustee or the U.S. Attorney
for their districts. It is clear from the 2003 survey, however, that some
courts have adopted rules requiring the retention of some paper documents
because of concerns expressed by these agencies.

It
should be noted that the problem of forged signatures is very unlikely to
involve documents signed and filed electronically through CM/ECF. A registered
user is issued a specific login and password that clearly identifies the user
when documents are electronically filed. CM/ECF does not depend on digital
signatures.<a href="#8" name="8a">8</a> It is contemplated that the password of a registered user may be
used by support staff or associates of the user. Therefore, most courts are
promulgating rules stating that use of the login and password
will constitute the signature of the user, even if another authorized person
files a document.<a href="#9" name="9a">9</a> This seems to follow case law that has held attorneys
responsible for documents filed by associates or subordinates in the
attorney's name.<a href="#10" name="10a">10</a> There is almost no possibility that a document could
be altered or changed once filed. Once a document is submitted, the CM/ECF
application provides non-court users no access to alter that document. CM/ECF
incorporates the use of a hash number to encrypt each PDF file transmitted to
the court. Once filed, programs check the files continually to ensure that no
changes are made to the document without authorization.

Therefore,
problems involving document authentication are limited to faxed filings or
electronically filed documents signed by parties other than the registered
user. In these areas, court practice is diverse. It is becoming more common for
courts to accept paper pleadings with no signature or with a facsimile
signature without a corresponding requirement that the original document be
later filed. But it is likely that in such instances the court has a rule
requiring that the filing party retain the original document for a period of
time.<a href="#11" name="11a">11</a>

This
diversity of practice results from the need to balance the very rare instances
in which signature forgery is alleged with the great administrative benefits of
the paperless court. But many bankruptcy courts are devising strategies to
accommodate both interests. The regulations needed to adapt the courts to the
new technologies are not occurring at the national level. In 1996, <a href="http://www.westlaw.com/find/default.wl?rs=CLWD3.0&vr=2.0&cite=F…
5005(a)</a> was amended to permit courts to permit documents to be
"filed, signed or verified by electronic means" provided that they
are consistent with Administrative Office of the U.S. Courts (AOUSC)-defined
technical standards.<a href="#12" name="12a">12</a> No standards have been issued, and each court has been
adopting rules and policies at a local level.

These
are some of the more commonly adopted strategies to deal with the perceived
need to retain some documents with original signatures:

1. Permit the filing of a document with either no signature or a facsimile
signature but only as a temporary measure. Many bankruptcy courts will accept documents faxed or electronically filed
without original signatures, but require that the originally signed document be
filed within a specified period of time.<a href="#13" name="13a">13</a> Some courts intend to retain
selected originally signed documents as part of the record indefinitely, and
others will image and discard the documents when received.

2. Require that the debtor file a declaration with original signatures which
verifies documents as required by <a href="http://www.westlaw.com/find/default.wl?rs=CLWD3.0&vr=2.0&cite=F…
1008</a>. It is common
for bankruptcy courts to require that both the debtor and the attorney for the
debtor sign and file a declaration with original signatures that acts to verify
the documents pursuant to <a href="http://www.westlaw.com/find/default.wl?rs=CLWD3.0&vr=2.0&cite=F…
1008</a>.<a href="#14" name="14a">14</a> This affidavit may be retained by the court as part of a permanent
record, but some courts intend to image and then discard the declaration. In
addition, many courts are requiring that CM/ECF users certify that a petition
or other document transmitted to the court electronically for filing is
properly signed and in the possession of the filing party when filed.<a href="#15" name="15a">15</a>

3. Retain documents with original signatures, but shift the burden of storing
them. Many courts require CM/ECF users to
sign agreements that state that the user will only transmit documents that are
appropriately signed. Although there is some feeling that this is an
impermissible delegation of the clerk's duty to maintain the official
record of the court, many courts are adopting this requirement. There is a wide
range in the amount of time that attorneys are required to retain the records.
In the 2003 survey, the majority of courts are setting retention periods of
four to five years, with a smaller number using one to two years. A few courts
do not state a time that would indicate that indefinite retention is required.

4. Rely on the record of §341 meeting record to provide the evidentiary
link. It seems likely that most cases of
bankruptcy fraud involve false statements made by debtors when filing the
schedules and statement of affairs. There are indications that some U.S.
Trustees or the assistants in some districts are modifying §341 procedures
to ensure that the debtors acknowledge on the record that petitions and
schedules filed electronically were reviewed by the debtors and that the
information is accurate. It also appears that some offices may be asking the
debtors to originally sign copies of the schedules at the first meeting, which
are then retained by the Office of the U.S. Trustee.

Whether
these strategies will continue to be considered necessary will almost certainly
depend on case law evolving in the next few years. Clearly, if bankruptcy fraud
cases are lost because of the lack of originally-signed documents, courts will
ensure that the documents are available. On the other hand, if the prosecutors
and courts find that cases can be effectively presented with imaged and virtual
documents, then the movement toward totally paperless courts will continue and
strengthen.

<hr>
<h3>Footnotes</h3>

<a name="1">1</a> The
verification may be made by filing an unsworn declaration pursuant to <a href="http://www.westlaw.com/find/default.wl?rs=CLWD3.0&vr=2.0&cite=2…
USC §1746</a>. <a href="#1a">Return to article</a>

<a name="2">2</a> <a href="http://www.westlaw.com/find/default.wl?rs=CLWD3.0&vr=2.0&cite=F…
9011(b)</a>. <a href="#2a">Return to article</a>

<a name="3">3</a> <a href="http://www.westlaw.com/find/default.wl?rs=CLWD3.0&vr=2.0&cite=F…
9011(c)</a>. <a href="#3a">Return to article</a>

<a name="4">4</a> In
a survey of bankruptcy court clerks, 17 of the 37 courts responding had dealt
with cases in which it was alleged that a court document contained a forged
signature. <a href="#4a">Return to article</a>

<a name="5">5</a> As
a clerk of court, I have spoken on several occasions to debtors who have
claimed that they did not file a bankruptcy because signatures on petitions
were forged either by a spouse or by their attorney. That these matters were
never pursued may have been due to the fact that the documents with an original
signature could be presented for examination. <a href="#5a">Return to article</a>

<a name="6">6</a> In
the survey of clerks, some clerks indicated that they will accept pleadings
without original signatures and that the burden is on the parties to object or
ask for correction. Other courts strike such pleadings sua sponte. <a href="#6a">Return to article</a>

<a name="7">7</a> See Federal Rule of Evidence 1002. Although this rule
requires that an original writing is required to prove the contents of the
writing, <a href="http://www.westlaw.com/find/default.wl?rs=CLWD3.0&vr=2.0&cite=F…
1003</a> goes on to state that a "duplicate is admissible to the
same extent as an original unless (1) genuine question is raised as to the
authenticity of the original or (2) in the circumstances it would be unfair to
admit the duplicate in lieu of the original." See, also, <a href="http://www.westlaw.com/find/default.wl?rs=CLWD3.0&vr=2.0&cite=2…
Life Assurance Society v. Starr, 241 Neb. 609,
489 N.W. 2nd 857(1992)</a>. <a href="#7a">Return to article</a>

<a name="8">8</a> McMillan,
Walker and Webster, Guidebook to Electronic Court Filing, p. 49 (1998). <a href="#8a">Return to article</a>

<a name="9">9</a> See Model Local Bankruptcy Court Rules for Electronic
Filing, Rule 8. <a href="#9a">Return to article</a>

<a name="10">10</a> See
<a href="http://www.westlaw.com/find/default.wl?rs=CLWD3.0&vr=2.0&cite=6… v. Halvorson-Berg, 69 Wash.App. 117, 847 P.2d
945 (1993)</a>. Other courts have found that if an attorney has not
personally signed a document, he is not subject to Rule 11 sanctions. <a href="http://www.westlaw.com/find/default.wl?rs=CLWD3.0&vr=2.0&cite=9…
v. Spindrift Yachts, 938 F.2d 962 (1991)</a>.
It seems likely that specific court rules and agreements signed by CM/ECF users
that make them responsible for filings by associates will make it easier for
courts to apply sanctions in similar cases in the future. <a href="#10a">Return to article</a>

<a name="11">11</a> In
the 2003 survey, a large majority of courts still require that petitions,
schedules and pleadings be filed with original signatures or that originals be
later filed. Nine of 37 responding courts accept some faxed documents for
immediate filing and do not require the original documents to be filed. In
some, if not all, of these courts, the faxing party is required to maintain the
original document and produce it on demand. <a href="#11a">Return to article</a>

<a name="12">12</a> See Advisory Committee Note (1996) to this rule. Courts
may treat documents with facsimile signatures as being unsigned for this
purpose. <a href="#12a">Return to article</a>

<a name="13">13</a> Since
the login and password of an attorney constitute the attorney's signature
to a document for an electronic filing in CM/ECF, this is not an issue for most
pleadings. The problem arises if a document is filed with signatures other than
that of the attorney. <a href="#13a">Return to article</a>

<a name="14">14</a> In
the 2003 survey, 11 of 27 responding courts require these declarations, and
most of these indicated that they would be retained indefinitely. <a href="#14a">Return to article</a>

<a name="15">15</a> In
the 2003 survey, 15 of 30 courts responding make this certification part of the
CM/ECF policy. <a href="#15a">Return to article</a>

Journal Authors

Mark Van Allsburg

Journal Date

Thursday, May 1, 2003 - 12:00

Bankruptcy Rule

2003