Coronavirus: using electronic signatures whilst homeworking or self-isolating

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The spread of COVID-19 is having a dramatic effect on our daily lives. As self-isolation increases, and the Government encourages home-working where possible, businesses and individuals may need to find alternative ways of signing important documents.

The gradual move towards electronic signatures observed over the last few years seems likely to accelerate in these exceptional circumstances. 

In September 2019 the Law Commission issued a report on the electronic execution of documents. The good news is that, broadly, the report found that electronic signatures can be used to execute documents provided:

  •  the person signing the document intends to authenticate the document; and
  •  any formalities relating to execution of that document are satisfied.

What does this mean in practice?

What is an electronic signature?

Each of the following is a valid form of electronic signature:

  •  a person typing their name into a contract, or into an email containing contractual terms;
  •  a person electronically pasting their signature (as an image) into an electronic version of the contract, in the appropriate place;
  • a person accessing a document through a web based e-signature platform and clicking to have their signature inserted in a handwritten font, in the appropriate place; 
  • a person using a stylus to sign on a touchscreen.

What kind of documents can be signed using an electronic signature?

All types of documents, including both simple contracts and even formal deeds, can be signed or executed using one of the above forms of electronic signature. 

As highlighted by the Law Commission, any relevant formalities relating to the execution of a particular document must also be satisfied. This could be set out in a statute and could include, for example, a requirement for a witness. An electronic document, signed electronically, will satisfy any requirement for a document to be "in writing".

What if an electronic signature must be witnessed?

Most signatures don't have to be witnessed. Usually, a witness is only required where an individual, or a single director on behalf of a company, is executing a deed. 

Where a witness is required, the witness must actually be physically present when the signatory inserts their electronic signature into the deed. But, subject to this, both the signatory and the witness can use an electronic signature.

Although there is no legal requirement for a witness to be independent, market practice is to require independence so that the witness is able to fulfil their role of providing reliable evidence about the execution of the document. However, as people are self-isolating or working from home with only close family members it seems likely that a more relaxed approach will have to be taken here. For example, a spouse could act as a witness with someone independent 'observing', such as via FaceTime, the signatory signing in the presence of the physically present witness. That independent observer could provide additional evidence if the attestation was ever challenged. A note could also be kept with the deed of the practical reasons for the witness being related.

But if the family member is also a party to the deed they cannot act as a witness for another party's signature on that deed.

Are any additional confirmations required?

Whilst not a strict legal requirement, to provide additional comfort as people transition to greater acceptance of electronic signatures, the following additional confirmations could be provided:

  • an email from the signatory, confirming that they inserted their electronic signature into the relevant document; and
  • where relevant, an email from the witness, confirming that they were physically present when the signatory inserted their electronic signature into the document, that they witnessed that signature being inserted and that they then inserted their own electronic signature into the document.

Can someone add my electronic signature to a document on my behalf?

Where someone other than the actual signatory inserts the signatory’s electronic signature into a document on their behalf, the usual rules of agency apply as regards the agent’s authority to do this. To provide certainty and avoid any arguments, the signatory should provide email confirmation that the agent had authority to insert their electronic signature into the relevant document on their behalf

However, this can't be done in the case of deeds. Authority to execute a deed on behalf of someone else can only be given by deed, typically by a power of attorney. An agent cannot execute a deed on behalf of another signatory, either by an electronic signature or a wet ink signature. In the absence of a power of attorney, the signatory’s electronic signature must be inserted into a deed by the actual signatory.

Are there any additional requirements?

Some public registers or bodies have their own requirements about the type of signatures they will accept. For example:

  • outside of their web-filing service, Companies House may require a wet ink signature;
  • HMRC will not accept an electronic signature on a document which requires stamp duty to be paid, such as stock transfer forms, and will require a wet-ink version; and
  • the Land Registry is running a project on electronic conveyancing which is being rolled out incrementally. Deeds which have to be registered under the Land Registration Act 2002 (such as transfers, mortgages and leases of more than seven years) were specifically excluded from the Law Commission’s recent consultation on electronic signatures referred to above and continue to require a wet ink signature. The Land Registry will accept contracts signed electronically for noting on the register against the title to which the contract relates.

The requirements of any such bodies should be checked before a relevant document is signed using an electronic signature.

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