Are electronically signed contracts the same as wet signature contracts?

Rebecca Robinson Rebecca Robinson 02 March 2021

Social distancing measures implemented during the COVID-19 pandemic have created numerous unprecedented challenges for businesses, including such simple matters as executing contracts.

With many firms reviewing their business continuity policies in light of the measures, how can the use of e-signatures be built in to work.

Rebecca Robinson, director in the company commercial team at Wake Smith Solicitors, sets out guidance for anyone needing to sign a contract who is unable to be there in person.

How can I sign a contract when I can’t be there in person?

It is possible to sign contracts remotely by signing a hard-copy contract in ‘wet-ink’, scanning it and emailing it, or by using an electronic signature.

Examples of electronic signatures include:

1. typing your name where a signature is required;
2. scanning your handwritten signature and attaching it onto an electronic document;
3. signing your signature onto a document using a touchscreen device; and
4. using an e-signing platform, such as Adobe Sign or DocuSign.

Does a remote/electronic signature validly execute a contract?

As contracts formed in England and Wales are not legally required to be in any particular form, both remotely signing and using an electronic signature will be valid in most circumstances.

The Law Commission has confirmed the validity of electronic signatures, subject to two fundamental caveats:

1. the person signing must intend to sign and be bound by the terms of the document; and
2. any execution formalities must be satisfied i.e. witnessing formalities.

The Law Commission also confirmed if a signature in a document is required to be witnessed, the witnesses must always be physically present to witness the signing, even when documents are remotely/electronically executed, and suggested three ways to do this:

1. witnessing through a window, with the window open or closed;
2. at a distance; or
3. in an outside public space maintaining social distancing.

Unfortunately, if there is a witnessing requirement for the document you wish to remotely/electronically sign and you are unable to comply, a remote or electronic signature would not be legally valid.

When might signing remotely be unsuitable?

Below is a non-exhaustive list of examples where remotely/electronically signing might be unsuitable:

1. Signing on behalf of a company: If you are signing on behalf of a company it is important to check the company’s constitutional documents (i.e. Articles of Association) to see if there are any restrictions on using electronic signatures.

2. Registration requirements: If the document needs to be registered after execution and the public registry only accepts wet-ink signatures, an electronic signature will not be suitable.

3. Witnessing requirements: If the document requires a witness to your signature, any remote/electronic signature will not be valid unless the witness is physically present to witness your signature.

4. Cross-border transactions: This guidance relates to the law of England and Wales. If you are contracting with a party outside of this jurisdiction you should seek advice from local counsel to ensure that any contracts or deeds executed remotely/electronically are valid.

If I am signing electronically does the other party have to sign electronically?

It has been confirmed by the Law Society 2016 Practice Note that a contract may be signed by one or more parties using an electronic signature and other parties signing in wet-ink.

For further information on contracts and other company commercial matters contact Rebecca Robinson at Wake Smith Solicitors on 0114 266 6660.

Tags

Archive

June 20221May 20227April 20223March 20223February 20223January 20224December 20214November 20213October 20215September 20216August 20212July 202111June 20218May 20216April 20212March 20219February 20218January 20219December 20208November 202013October 20209September 20208August 20203July 20208June 202016May 202013April 20209March 202016February 20209January 202011December 20199November 20199October 201911September 20197August 20194July 20196May 20198April 20196March 20193February 20195January 20194December 20186November 20185October 20182September 20185August 20184July 20189June 20184May 201810April 20185March 20184February 20184January 20183December 20175November 20178October 20177September 20179August 20175July 20176June 201710May 20176April 20178March 201711February 20177January 201713December 20169November 20167October 201610September 201610August 20166July 20167June 20163May 20162April 20166March 20162February 20164January 20165December 20153November 20155October 20156September 20156August 20157July 20157June 20157May 20156April 20159March 20156February 201510January 20156December 20145November 20144October 20142September 20143May 20144March 20146February 20144January 20142December 20132November 20133September 20134July 20132June 20132May 20133April 20131March 20133February 20133January 20136December 20121November 20123October 20122August 20122July 20128June 20123April 20123March 20121January 20124December 20112November 20111October 20112September 20113August 20113July 20117June 20119May 20117April 20115March 20119February 20118January 20111December 20101October 20102September 20102August 20103July 20106June 20101May 20102April 20106March 20102February 20103January 20102December 20095November 20092October 20092September 20092August 20091July 20095June 20095May 20093April 20093March 20093February 20091January 20092November 20082October 20082September 20081August 20083July 20081January 20082

Featured Articles

Contact us