The Law Commission has recently (4 September 2019) published guidance on the electronic execution of documents. Having first undertaken a period of consultation, it outlined in its report its conclusions regarding the validity of electronic signatures, and in particular concluded that:

  1. An electronic signature is capable in law of being used to execute documents, including deeds, provided that it is clear that the person signing intended to authenticate the document and any relevant formalities are satisfied.
  2. In the case of deeds that require execution “in the presence of a witness”, physical presence of that witness would still be required, albeit that the witness can also sign electronically. For these purposes, it did not consider that, at this time, video conferencing would be adequate.
  3. An electronic signature is admissible in evidence in legal proceedings.
  4. Unless legislation, contractual obligations or case law requires otherwise, the form of electronic signature is not prescriptive and could even take less obvious forms of signature such as signing with an “X”, a typed name at the bottom of an email or clicking an “I accept” tick box on a website.  

The Law Commission has recommended that an industry working group be established to consider and explore further some of the associated practical issues, such as video witnessing and the various technologies available to help evidence identity and intention to authenticate when documents are executed electronically. Therefore, further guidance on this is likely to follow in due course.

Although it felt that the existing law around electronic signatures is sufficient, the Law Commission did recognise some advantage of legislative reform for clarity, certainty and accessibility.

So what does this mean, practically speaking? The logistics for completing transactions of signing legal documents more generally are likely to become much more flexible. The often cumbersome and time-consuming exercise of having to sign documents at your solicitors’ office, signing and returning documents by post or even printing pages attached to emails to sign and scan back to your solicitor could, in most cases, be easily replaced using a form of electronic signature. Electronic signature software already exists to help simplify this process and verify signatures. The time and money saving consequences of this, particularly when solicitors and clients are not in the same country, are obvious.

For more information the Thompson Smith and Puxon Corporate and Commercial team can be contacted on 01206 574431 or by email at info@tsplegal.com.