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Electronic execution of documents

Electronic execution of documents

Published: 11th September 2019
Area: Corporate & Commercial
Author: James Fownes

Education institutions are regularly required to sign contracts, deeds and other documents. As such, there is some advantage in terms of convenience to using so-called electronic signatures. A question naturally arises as to whether such electronic signatures are adequate to have legal effect?

If a signature is not adequate, then this could have far-reaching consequences in terms of the enforceability of the contract.

The Law Commission has sought to provide more clarity around this issue in its report dated 4 September 2019.

In short, the Law Commission has concluded that an electronic signature can be legally effective in certain circumstances.  This is provided that any other relevant formalities are followed.  For example, if statute or the relevant contractual framework requires that the signature be witnessed, then this must still take place.

The Law Commission has provisionally concluded that further legislation / law reform is not essential, as the existing law is sufficient. However, the government may wish to consider codifying the relevant law so that it is more easily accessible.It may be possible in the future for signatures to be witnessed by video link.  However, the Law Commission did not consider that the existing law was sufficiently clear on the point, and this is one area for possible reform.  As such, institutions would be well advised to hold off from adopting this practice for the time being until it has been tested by the courts / further reform is implemented.Whilst it is clear that the use of electronic signatures is acceptable in general terms, we would nonetheless advise that institutions take advice as to the most appropriate form of signature to be used in any particular circumstances.

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