During the course of their career, and particularly as a junior, any lawyer worth their salt will inevitably spend an inordinate amount of time checking that deeds have been properly executed. Whilst not the most thrilling part of our job, it is certainly one of the most important. But why is that?
Firstly, incorrectly executed documents cause delay and inconvenience, especially in the document-heavy construction sector – awash with Appointments, Novations, Collateral Warranties, and Reliance Letters. Once a mistake is identified each incorrectly executed document will need to be re-issued for re-execution.
Secondly, an incorrectly executed document may prejudice your ability to make claims, as explained below. If not rectified, an incorrectly executed deed may still take effect as a contract. However, the statutory limitation period for being able to bring claims under a deed is 12 years, but falls to 6 years under a simple contract.
Property defects can take years to materialise, so it’s always safer to take the time to ensure that your deed is properly executed from the outset.
The Law: what does it say?
Companies – Section 44 Companies Act 2006
In England and Wales, companies governed by the Companies Act 2006 can execute deeds in four ways:
Individuals – Section 3 Law of Property (Miscellaneous Provisions) Act 1989
A document is validly executed as a deed by an individual if, and only if, it is signed:
- by the individual in the presence of an independent witness; or
- at the individual’s direction and in their presence, and also in the presence of two witnesses who attest the signature.
You’d be astonished at the creative ways in which a deed can be incorrectly executed. Fortunately, as this is a blog post rather than War and Peace, we have separated the wheat from the chaff and set out a ‘greatest hits’ of execution mistakes below:
Executing deeds properly is a seemingly simple, but often overlooked, subject. However, if you have any concerns, your solicitors are there to help. Some top tips when executing documents on behalf of a company are to:
If you would like to discuss any of the above, please do not hesitate to contact us.