Blockchain for a Single Source of Truth in Legal Documents
The legal industry is one of the industries that relies heavily on the authenticity and accessibility of truth in form of legal documents. These legal documents are treated in courts as evidence in cases. There are often disputes lodged against the credibility of some legal documents and that may take lawyers in a journey of dispute after dispute. In order to reduce such disputes, lawyers can rely on time-stamped signatures and immutable records of established contracts.
I was among those who remained screwed in front of the TVs during the hearing of the case that was challenging the re-election of Kenya’s President Uhuru Kenyatta at the Supreme Court in 2017. The case involved some of the Kenya’s top lawyers and bulky petition files and evidence ranging from 25,000 to 50,000 pages of documents. One thing that was a point of contention between the lawyers of petitioners and respondents was the proof of authenticity or validity of documents such as affidavits sworn by witnesses or involved parties. The magnitude of that case expressed and implied to us how instrumental authentic and valid legal documents are in the legal industry.
The benefit of a single source of truth built on the Blockchain can therefore not be under-estimated in the legal industry. During my information search, I learnt that there are states in the United States that have already enacted into law the acknowledgement of the legality of contracts and signatures that are secured on the Blockchain network. For example, in Vermont, Blockchain-based signatures and contracts are admissible as evidence in courts of law. This is just the beginning and this trend is expected to replicate in many other states in the US and in other countries around the world. In 2016 Vermont Statutes, Title 12 – Court Procedure, Chapter 81- Conduct of Trial, Sub-Chapter 1: Generally in section § 1913. Blockchain enabling, it states thus:
“(1) A digital record electronically registered in a blockchain shall be self-authenticating pursuant to Vermont Rule of Evidence 902, if it is accompanied by a written declaration of a qualified person, made under oath, stating the qualification of the person to make the certification and the date and time the record entered the blockchain; the date and time the record was received from the blockchain; that the record was maintained in the blockchain as a regular conducted activity; and that the record was made by the regularly conducted activity as a regular practice.” —Vermont Statutes, Universal Citation: 12 V.S.A. § 1913
In subdivision 2 of the section, it states as follows:
“(2) A digital record electronically registered in a blockchain, if accompanied by a declaration that meets the requirements of subdivision (1) of this subsection, shall be considered a record of regularly conducted business activity pursuant to Vermont Rule of Evidence 803(6) unless the source of information or the method or circumstance of preparation indicate lack of trustworthiness. For purposes of this subdivision (2), a record includes information or data.” —Vermont Statutes, Universal Citation: 12 V.S.A. § 1913
I find subdivision 5 also interesting to share here, it says thus:
“(5) A person against whom the fact operates has the burden of producing evidence sufficient to support a finding that the presumed fact, record, time, or identity is not authentic as set forth on the date added to the blockchain, but the presumption does not shift to a person the burden of persuading the trier of fact that the underlying fact or record is itself accurate in what it purports to represent.” —Vermont Statutes, Universal Citation: 12 V.S.A. § 1913
Another state where Blockchain-based signatures and contracts are acknowledged legally is Arizona.
In 2017 Arizona State enacted a law that acknowledges the legality of contracts and signatures that are secured on the Blockchain. I captured some of the quotes from that law in section 447061: Signatures and records secured through blockchain technology; smart contracts; ownership of information; definition and among others states as follows:
“D. Notwithstanding any other law, a person that, in or affecting interstate or foreign commerce, uses blockchain technology to secure information that the person owns or has the right to use retains the same rights of ownership or use with respect to that information as before the person secured the information using blockchain technology. This subsection does not apply to the use of blockchain technology to secure information in connection with a transaction to the extent that the terms of the transaction expressly provide for the transfer of rights of ownership or use with respect to that information.” —Law enacted in Arizona State in 2017
So this is something that is expected to expand in application over the next few years. If you are an advocate, it is important that you put your law firm in a path to acknowledging these single sources of truth even before the national government does so. It is called pro-activeness; you act in advance to a contemplated action with regard to new or existing information. Don’t check that in the dictionary, it is my own definition to suit this context. Blockchain is slowly gaining popularity and before we know it many institutions and individuals will recognize it as a reliable tool for use in many aspects of life including legal.
“With Blockchain, if we sign a contract, now or forever, we will be able to confirm that.” —DavidFisher, the co-founder of Integra Ledger, to Bloomberg Law, 2017
Integra Ledger in partnership with other businesses has built a proof of concept on monitoring process servers that notify defendants of lawsuits, register legal documents uploaded to cloud platforms, and track credits for a continuing legal education. Integra Ledger is a Blockchain-based law application that provides new foundation for integrity, security, and inter-operations in the global legal industry. Integra uses a new concept of the universal identities for legal matters, documents, contracts and clients based on the Blockchain. The universal identities can be put into use by existing software to preserve legacy investments of the law firms and their clients.
Founder ChainAdvise Blockchain Advisory,
An extract from the book ‘Understanding the Blockchain’