18 September 2019
Digitising disputes – 10 of 15 Insights
The Law Commission has been consulting on the use of electronic signatures. The purpose of the consultation was to determine the extent to which there might be problems with the law around electronic execution of documents and deeds which are preventing the use of electronic signatures when they might otherwise be beneficial. The consultation covered deeds including powers of attorney but not wills or registered dispositions under the Land Registration Act 2000.
The Law Commission has published a report following its consultation. The report summarises current law on the use of electronic signatures and makes a number of recommendations, chief of which is that an industry working group be set up to consider the issues raised in the consultation and to provide best practice guidelines. The Commission also suggested the government consider a wider review on the use of deeds.
The report concluded that the law is relatively clear on the use of electronic signatures, that they are capable of being used in law (subject to any specific contractual or statutory requirements) and are admissible in evidence. As such, the Law Commission did not recommend changing current law but did suggest that the government consider codifying it in order to gather it all into one place.
The Law Commission's conclusion on executing deeds is probably of greatest interest as the evidentiary element of witnessing an electronic signature has been something of a grey area. The Commission's view is that deeds can be signed and witnessed electronically but that the witness must be physically present when the deed is signed. Where a deed is executed by two Directors or by a Director and Company Secretary, all signatures may be electronic and need not take place at the same time.
The Law Commission identified a number of key issues raised in the response to its consultation:
The Law Commission goes on to set out its conclusions as to current law on electronic signatures, both where there is and is not a statutory requirement.
The Law Commission makes a number of recommendations:
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