Give me a sign

Electronic Signatures

With the vast majority of office workers currently working from home, the use of electronic signatures offers a convenient alternative to the time-honoured printing, signing and scanning of documents.

The signing of contracts electronically has existed for many years, ranging from businesses completing complex commercial agreements, to individuals signing for delivery of goods purchased online.  As is common, legislation has not kept pace with this emerging technology, leaving some doubt as to how and when an electronic signature can be used.

Law Commission – Electronic Execution of Documents

With the above in mind the Law Commission set out to address any uncertainty as to the formalities around the electronic execution of documents.  Their report has concluded that an electronic signature is capable in law of being used to execute a document (including a deed), provided that the signatory intends to authenticate the document and that any relevant formalities, such as the signature being witnessed, are satisfied.

Analysis

The Law Commission reviewed the pragmatic, objective approach taken by the Courts, which have considered all of the surrounding circumstances when determining whether or not a signature is valid.  The Courts have concluded that various non-electronic forms amount to valid signatures, including signing a document with an ”X”, using a stamp of a handwritten signature and even a description (if sufficiently unambiguous), such as “Your loving mother”.  The Law Commission found no reason in principle why the Court should not recognise electronic signatures as valid signatures.  It was noted that the Courts have previously determined that a name typed at the bottom of an email amounted to a valid signature.

Points to consider when using an electronic signature

Electronic signatures are more susceptible to fraud than handwritten signatures, which could put vulnerable people at risk, therefore:

• you must be satisfied as to the reliability and security of the technology used to create and apply the electronic signature
• if the signature must be witnessed (as is required in respect of a deed), the witness can apply an electronic signature but must be physically present to witness the signature as the current law does not allow for “remote” witnessing such as by video link.

For further questions please contact Mark Richardson directly on [email protected] or 0207 822 2240

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