- COVID-19: Witness requirements for executing documents
COVID-19: Witness requirements for executing documents
COVID-19: Witness requirements for executing documents24th April 2020 - Published by
Continuing our commentary and guidance on the subject of execution of legal documents, following our article on signing or executing documents, we look at witness requirements and the possibility of using e-signatures.
In certain circumstances, a party’s signature to a deed must be attested by a witness. For example:
- If the executing party is an individual, the document will only be validly executed as a deed if it is signed either by the individual in the presence of a witness who attests the signature, or at the direction and in the presence of the individual and the presence of two witnesses who each attest the signature(1).
- If the executing party is a company and it executes the document by the signature of one director , the executing director(2) must sign in the presence of a witness who attests the signature.
In this article we will be considering:
- Who can act as a witness?
- Must the witness be physically present?
- Must the executing party and witness sign contemporaneously?
- Are electronic signatures acceptable?
- When will electronic signatures not be appropriate?
1. Who can act as a witness?
A party to a deed cannot be a witness(3).
There is no statutory requirement for the witness to be independent or disinterested. Moreover, there is no prohibition on a signatory’s spouse, co-habitee or civil partner from acting as a witness. It is also generally acceptable for an employee or director of a party to witness that party’s signature(4). However, given that the purpose of requiring a party’s signature to be witnessed is to provide, if necessary, unbiased evidence of what was signed, by whom and when, independent witnessing should always be required as a matter of best practice.
2. Must the witness be physically present?
It is a statutory requirement that the maker of a deed executes it in the presence of the witness(5). It is generally considered that these provisions require the physical presence of a witness when the deed is signed(6). This position is supported by paragraph 8 of the statement of law set out in the Law Commission’s 2019 report on the electronic execution of documents, which expresses the view that:
”… the requirement under the current law that a deed must be signed “in the presence of a witness” requires the physical presence of that witness. This is the case even where both the person executing the deed and the witness are executing / attesting the document using an electronic signature.”
However, a party may be estopped from denying the validity of deed that appears to be, and is held out to have been, validly executed where the witness was not present when the executing party signed the deed(7).
3. Must the executing party and witness sign contemporaneously?
As the witness must be physically present when the executing party executes the deed, it is usual practice for the witness to sign the deed at the same time as the executing party. However, provided that the deed was actually executed in the presence of the witness, there is some authority to suggest that the addition of the witness’s signature to the deed at some point subsequent to its execution by the executing party may not render the deed invalidly executed(8). Despite this decision, caution should be exercised, and the better practice is to ensure that the witness signs the deed immediately after the executing party.
4. Are electronic signatures acceptable?
In essence, it will be possible under English law to validly sign documents via electronic signature. However, it cannot be taken for granted that electronic signatures will be valid in another jurisdiction, so on any cross- border matter, local legal advice will be needed. And, even in the English law context, there are some documents and circumstances for which electronic signature will not or may not be suitable.
The English law position is that electronic signatures are valid. This was confirmed by the Law Commission in its report, “Electronic execution of documents” (published in 2019) and recently endorsed in a UK Government Ministerial Statement on 3 March 2020.
The Law Commission confirmed that an electronic signature is capable of being used to execute a document, including a deed, provided there is an intention to authenticate and any execution formalities are satisfied.
However, the Law Commission’s view is that where there is a requirement for a deed to be signed “in the presence of a witness”, the witness must be physically present.
5. When will electronic signatures not be appropriate?
It is impossible to provide a complete list, but here are some examples where under English law, e-signing may not be acceptable (for either contracts or deeds), including:
- Where a wet ink signature is required for filing purposes;
- Where a document requires A notary will generally require a ‘wet ink’ signature and for the document to be signed in the presence of the notary;
- If the corporate seal is being used to execute the document;
- If there is a restriction on the use of electronic signatures in the constitutional documents of the executing company/other entity;
- Where the laws of another relevant jurisdiction restrict or prevent it;
- If there are other restrictions under legislation or case
To speak to an expert advisor about the signing or execution of documents, for example if a deed has been correctly executed or not using witnesses and/or e-signatures, please contact our head of banking & real estate finance George MacMillan on 0161 838 7998 or at firstname.lastname@example.org.