If a change or error in an electronic record occurs in a transmission between parties to a transaction, the following rules apply:
 1. If the parties have agreed to use a security procedure to detect changes or errors and one party has conformed to the procedure, but the other party has not, and the nonconforming party would have detected the change or error had that party also conformed, the conforming party may avoid the effect of the changed or erroneous electronic record.

Terms Used In Iowa Code 554D.112

  • Agreement: means the bargain of the parties in fact, as found in their language or inferred from other circumstances and from rules, regulations, and procedures given the effect of agreements under laws otherwise applicable to a particular transaction. See Iowa Code 554D.103
  • Automated transaction: means a transaction conducted or performed, in whole or in part, by electronic means or electronic records, in which the acts or records of one or both parties are not reviewed by an individual in the ordinary course of forming a contract, performing under an existing contract, or fulfilling an obligation required by the transaction. See Iowa Code 554D.103
  • Electronic: means relating to technology having electrical, digital, magnetic, wireless, optical, electromagnetic, or similar capabilities. See Iowa Code 554D.103
  • Electronic agent: means a computer program or an electronic or other automated means used independently to initiate an action or respond to electronic records or performances in whole or in part, without review or action by an individual. See Iowa Code 554D.103
  • Electronic record: means a record created, generated, sent, communicated, received, or stored by electronic means. See Iowa Code 554D.103
  • following: when used by way of reference to a chapter or other part of a statute mean the next preceding or next following chapter or other part. See Iowa Code 4.1
  • Person: means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, governmental agency, public corporation, or any other legal or commercial entity. See Iowa Code 554D.103
  • Record: means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form. See Iowa Code 554D.103
  • Security procedure: includes a procedure that requires the use of algorithms or other codes, identifying words or numbers, encryption, or callback or other acknowledgment procedures, and includes digital signature technology. See Iowa Code 554D.103
  • Transaction: means an action or set of actions occurring between two or more persons relating to the conduct of business, commercial, or governmental affairs. See Iowa Code 554D.103
 2. In an automated transaction involving an individual, the individual may avoid the effect of an electronic record that resulted from an error made by the individual in dealing with the electronic agent of another person if the electronic agent did not provide an opportunity for the prevention or correction of the error and, at the time the individual learns of the error, all of the following apply:

 a. The individual promptly notifies the other person of the error and that the individual does not intend to be bound by the electronic record received by the other person.
 b. The individual takes reasonable steps, including steps that conform to the other person’s reasonable instructions, to return to the other person or, if instructed by the other person, to destroy the consideration received, if any, as a result of the erroneous electronic record.
 c. The individual has not used or received any benefit or value from the consideration, if any, received from the other person.
 3. If subsection 1 or 2 does not apply, the change or error has the effect provided by other law, including the law of mistake, and the parties’ contract, if any.
 4. In a consumer transaction, any substantive law limiting a consumer’s liability shall apply to an electronic transaction.
 5. Subsections 2, 3, and 4 shall not be varied by agreement of the parties.