Mar 2020
In the UK electronic signatures have been legal since the introduction of the Electronic Communications Act 2000.
Now that we are all trying to accommodate working from home and interacting with each other remotely we should consider the electronic signature to help us continue with ‘business as usual’.
Commercially it is becoming more and more common especially as flexible working is on the rise.
Electronic signatures can be done in a number of different ways. You may choose to upload an image of your personal signature, use a document signing application or service, use a unique reference code or mark the document in the relevant box to indicate consent. There are many ways to execute a document and these methods can even apply to someone witnessing a document. A witness must still fulfil the requirement of witnessing the signature being executed but this can now be done by video or in the same room and both can execute the document electronically via the same device if need be. Where documents are signed in counterpart these will still be valid if the document signed is identical in format and also in the absence of an express provision in the contract.
However, electronic signatures are not suitable for certain types of contract. Some organisations and legal bodies still favour the wet ink signature due to the lower risk of fraud. HM Land Registry still requires a wet signature on documents used for property transactions whereas Companies House and HMRC have changed their policies in the last few years to accommodate for the change in commercial business to favour the ease and practicality of the electronic signature. When it comes to documents that go before the Court, electronic signatures can be accepted but it is still preferable to have supporting evidence such as emails or attendance notes to demonstrate the negotiations leading up to the signing.
For commercial documents between different jurisdictions the effectiveness of the method of signing will depend on the governing jurisdiction of the contract. Electronic signatures are valid in England and Wales but may not be in other countries and this should be taken into account when drafting and preparing the agreement.
If you and your business have found yourself in the position of having to work remotely during these strange times and find yourself in need of advice regarding execution and signing of documents, please get in touch with our corporate commercial team -we are here to help!
