Italian law update: Court of Milan hands down a decision on legal value of email correspondence

As the world enters the age of artificial intelligence, the use of technology in the legal sector continues to create interpretative difficulties and misunderstandings, sometimes with serious consequences, over seemingly trivial matters.

One issue that the Court of Milan examined recently in an insurance dispute was the meaning of the term ‘signature’ as used in the Italian Civil Code, and, in particular, the different ways of executing documents in a world where paper documents on which a handwritten signature can be affixed is increasingly uncommon.

In the dispute, an insured person (the Insured) sought recognition of his right to the full reimbursement of the costs incurred in the defence of a multi-million-dollar lawsuit brought before the Judicial Authority of the State of California, for which the D&O insurer had granted only a partial refund.

In parallel with the proceedings in the U.S, and following an initial request for the refund made by the Insured using ordinary mail, the Insured corresponded extensively with the Insurers by email correspondence over a number of years, in an attempt to obtain the full refund, which was continually declined by the Insurers.

Following the end of the U.S. litigation, the Insured sent a letter-before-action to the Insurers and shortly after filed a lawsuit to recover all the money paid to their U.S. lawyers.

Under the applicable substantive rules, the limitation period for bringing such a claim is two years and runs from the date when the lawyer's invoices become payable.

However, the limitation period can easily be “reset” by a claim notice, i.e., any written document where the creditor makes it clear to the debtor that they intend to obtain performance.

The Insured referred to the email correspondence to provide evidence that the claim for the refund was not time barred as the limitation period had been extended by various email messages. However, the Court of Milan found in the Insurer’s favour.

It is a settled principle that the limitation period can be reset by any communication. A formal request for performance is not required. Any communication expressing, explicitly or implicitly, the intention to exercise the creditor’s right is sufficient (see, judgment by Corte di Cassazione no 24913/2022). However, the communication must be in written form.

Indeed, “when dealing with legal acts with declaratory content, such as the letter putting the debtor in default, written form is required. The signature, i.e., the way in which the signatory identifies themselves as the author of the document, shall also comply with the written form requirement, the signature being an essential feature of the document itself, absent which the document has no legal effect.” (See, judgment by Corte di Cassazione no 12182/2021).

Therefore, a request for payment which lacks execution by the author is not sufficient to “reset” the limitation period.

The question is how should the signature be affixed in the case of electronic communications (e-mails)?

According to Article 20 bis of Legislative Decree 82/2005 (‘Digital Administration Code’):

“The informatic document satisfies the requirement of written form ….when it is affixed with a digital signature, another type of qualified electronic signature, or an advanced electronic signature or, in any case, is formed, after computer identification of its author, through a process having the requirements established by AgID pursuant to Article 71 in such a way as to guarantee the security, integrity and unchangeability of the document and, in a manifest and unequivocal manner, its traceability back to its author.”

In this case, the Court of Milan found that, since the Insured had signed the email communications to the Insurers merely by typing her full name, without carrying out any of the formalities required to qualify the ‘signature’ on the basis of the forms permitted under Art. 20, the emails were deemed ‘non-executed’ documents, and, as such, insufficient to interrupt the time-bar period.

This important decision of the Court of Milan follows a recent judgment by the Corte di Cassazione, which ruled that emails lacking an ‘electronic signature’ have no legal standing, since according to the Digital Administration Code, “only a computer document signed with an advanced, qualified or digital electronic signature can be considered executed by the author” (Court of Cassation, judgment 22012/2023).

In conclusion, the utmost care needs to be paid to the form of communications, bearing in mind that email messages, a common and fast manner of communication, may fall short of the basic requirements to have any legal effect under the Italian Civil Code.