deed of assignment electronic signature

Deed of Assignment (for Intellectual Property)

In the realm of intellectual property, a Deed of Assignment is a formal legal document used to transfer all rights, title, and interest in intellectual property from the assignor (original owner) to the assignee (new owner). This is crucial for the correct transfer of patents, copyrights, trademarks, and other IP rights. The deed typically requires specific legal formalities, sometimes notarization, to ensure it is legally enforceable.

To be legally effective a deed of assignment must contain:

• Title of the Document : It should clearly be labeled as a "Deed of Assignment" to identify the nature of the document.
• Date : The date on which the deed is executed should be clearly mentioned.
• Parties Involved : Full names and addresses of both the assignor (the party transferring the rights) and the assignee (the party receiving the rights). This identifies the parties to the agreement.
• Recitals : This section provides the background of the transaction. It typically includes details about the ownership of the assignor and the intention behind the assignment.
• Definition and Interpretation : Any terms used within the deed that have specific meanings should be clearly defined in this section.
• Description of the Property or Rights : A detailed description of the property or rights being assigned. For intellectual property, this would include details like patent numbers, trademark registrations , or descriptions of the copyrighted material.
• Terms of Assignment : This should include the extent of the rights being transferred, any conditions or limitations on the assignment, and any obligations the assignor or assignee must fulfill as part of the agreement.
• Warranties and Representations : The assignor typically makes certain warranties regarding their ownership of the property and the absence of encumbrances or third-party claims against it.
• Governing Law : The deed should specify which jurisdiction's laws govern the interpretation and enforcement of the agreement.
• Execution and Witnesses : The deed must be signed by both parties, and depending on jurisdictional requirements, it may also need to be witnessed and possibly notarized.
• Schedules or Annexures : If there are detailed lists or descriptions (like a list of patent numbers or property descriptions), these are often attached as schedules to the main body of the deed.

Letter of Assignment (for Trademarks and Patents)

This is a less formal document compared to the Deed of Assignment and is often used to record the assignment of rights or licensing of intellectual property on a temporary or limited basis. While it can outline the terms of the assignment, it may not be sufficient for the full transfer of legal title of IP rights. It's more commonly used in situations like assigning the rights to use a copyrighted work or a trademark license.

For example, company X allows company Y to use their trademark for specific products in a specific country for a specific period.  

At the same time, company X can use a Letter of Assignment to transfer a trademark to someone. In this case, it will be similar to the Deed of Assignment. 

Intellectual Property Sales Agreement

An IP Sales Agreement is a detailed contract that stipulates the terms and conditions of the sale of intellectual property. It covers aspects such as the specific rights being sold, payment terms, warranties regarding the ownership and validity of the IP, and any limitations or conditions on the use of the IP. This document is essential in transactions involving the sale of IP assets.

However, clients usually prefer to keep this document confidential and prepare special deeds of assignment or letter of assignment for different countries.

IP Transfer Declaration

In the context of intellectual property, a Declaration is often used to assert ownership or the originality of an IP asset. For example, inventors may use declarations in patent applications to declare their invention is original, or authors may use it to assert copyright ownership. It's a formal statement, sometimes required by IP offices or courts.

When assigning a trademark, the Declaration can be a valid document to function as a proof of the transfer. For example, a director of company X declares that the company had sold its Intellectual Property to company Y. 

Merger Document

When companies or entities with significant IP assets merge, an IP Merger Document is used. This document outlines how the intellectual property owned by the merging entities will be combined or managed. It includes details about the transfer, integration, or handling of patents, copyrights, trademarks, and any other intellectual property affected by the merger.

In all these cases, the precise drafting of documents is critical to ensure that IP rights are adequately protected and transferred. Legal advice is often necessary to navigate the complexities of intellectual property laws.

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Business expertise

Personal expertise, all expertise, electronic signatures – when can i use them and when can't i.

• Publications
• 8 September 2023

Many businesses have been signing electronically for some time, particularly during the pandemic.

The legal requirements regarding electronic signatures are contained in Part 4 of the Contract and Commercial Law Act 2017 ( CCLA ) (previously the Electronic Transactions Act 2002).

When can I use an electronic signature?

Subject to a few exceptions referred to further below, the general position under the CCLA is that electronic signatures can be used and will be considered just as valid as written signatures as long as certain requirements are met. All parties to the document must also generally consent to the use of electronic signatures. This means in practice you can sign the following documents electronically:

• Agreements for Sale and Purchase of Real Estate;
• Commercial agreements;
• Leasing documentation;
• Director resolutions;
• Shareholder resolutions; and
• Trustee Resolutions.

When can I not use an electronic signature?

Schedule 5 of the CCLA provides a list of examples where an electronic signature cannot be used. These include but are not limited to:

• Wills, codicils or other testamentary instruments;
• Affidavits;
• Statutory Declarations;
• Other documents that are given on oath or affirmation;
• Powers of Attorney and Enduring Powers of Attorney; and
• Information that is required to be given in writing in person, unless the receiving the electronic signatures consents.

What about deeds?

Deeds can be signed electronically, but there are important points to consider in terms of formalities. For New Zealand companies, a deed must normally be signed by two directors or, if there is only one director, by that director in the presence of a witness.

In the case of two directors, each director can sign in counterparts using electronic, wet ink signatures or a combination of both. However, if a sole director is signing in the presence of a witness, the witness must observe the director’s signature first before signing themselves (electronically or by wet ink).

Best practice is for the witness to be physically present (not by audio-visual technology) when observing the director’s electronic signature. The usual requirements in relation to witnesses still apply to electronic signatures i.e. the witness should not be a party to the deed and should be adequately identified by stating their name, address and occupation.

Is an electronically signed document an “original”?

Yes. If a document has been signed electronically it will constitute an original document provided the electronic signing method reliably assures the integrity of the document. In practice this means taking steps to ensure that the document cannot be tampered with or changed after signing (other than by using the same amendment rules that apply to wet ink documents).

If you have any questions about signing documents electronically, please feel free to get in touch with a member of our data protection and privacy or corporate and commercial teams.

Disclaimer: the content of this article is general in nature and not intended as a substitute for specific professional advice on any matter and should not be relied upon for that purpose.​

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Signed, sealed, delivered: execution of deeds and documents and how it might go wrong.

Published on 29th Sep 2016

After a series of long and complex negotiations, the document is finally agreed. Each party breathes a sigh of relief. But now the document must be validly executed – and this is where all the hard work in reaching agreement can be undone.

Below we answer ten questions that are commonly raised in relation to the execution of deeds and documents.

1. Can a contract be executed electronically?

Yes! English law lays down few formalities for the form of a contract and almost all simple contracts, even those which statute requires are “in writing” or “signed”, can be executed electronically. However, one point to bear in mind is whether the document will need to be filed with any authority or registry which may insist on a wet ink signature.

2. Can a deed be executed electronically?

Yes! The Law Society’s practice note  on the execution of a document using an electronic signature, which was published on 21 July 2016 and which represents the Law Society’s view of good practice in this area, has clarified that a deed can be executed electronically. At common law, a deed must be in writing, but there are a number of cases which have confirmed that an electronic representation of a document (for example, an exchange of emails) can satisfy this “in writing” requirement.

Commonly, deeds are executed on behalf of a company by a director of that company in the presence of a witness who attests the signature of the director. The Law Society’s practice note states that if that witness “genuinely observes” the director signing the deed using an electronic signature, and the witness then goes on to sign the adjacent attestation clause, the deed will have been validly executed. It is best practice for the witness to be physically present when the signatory signs the deed.

3. What has to be done to ensure that a deed is “delivered”?

One of the distinguishing factors about the execution of a deed as compared to a contract is that a deed must be “delivered”. Delivery fixes the date from which the executing party is bound by the deed, and once delivered, a deed is irrevocable in the absence of an express right of revocation. At common law, a deed is delivered when a party expresses an intention to be bound by the deed, even if it retains possession of the document.

The best way to deal with delivery of a deed is to have clear wording in the document setting out that the deed will be delivered on the date appearing at the head of the document. Where a deed is executed by a company, legislation provides that it is presumed to be delivered on execution, unless a contrary intention is proved. There is no such presumption for execution by an individual. Clear wording in the document confirming the position on delivery will avoid confusion and unintended consequences.

4. What date should be inserted into the deed?

Where a deed contains wording stating that it is executed and delivered on the date appearing at the head of the document, as recommended above, then a date should be inserted that is on or after the date that the last signatory signed. However, if the deed does not contain such wording, case law has held that the absence of a date will not affect its validity, which usually takes effect from delivery.

A deed may in certain circumstances be drafted for its provisions to take effect from a date before the date of its execution. If so, care is required. For example, in pensions, many deeds purporting to make, or to “confirm” amendments to a pension scheme made from a date prior to the date of execution and delivery of the deed have been found to be ineffective, due to statutory and case law restrictions on the power to amend a pension scheme retrospectively.

No deed or contract must ever be back dated (i.e. given a date that is earlier than the date it was executed). This is potentially fraudulent.

5. Who can be a witness to the signatory of a deed?

There is no statutory provision requiring a witness in these circumstances to be independent. However the purpose of having a witness is so that they can provide unbiased evidence of what was signed and by whom, if required in the future. Therefore a witness should be independent and it is best practice to interpret this widely.

A witness should not be the signatory’s spouse or partner or a family member, and should not have a personal interest in the provisions of the document. Case law has confirmed that a party to the document cannot act as a witness to another party’s signature. It is advisable that a witness is aged eighteen or over.

6. Do all parties have to sign the same document?

No. If the parties to an agreement do not intend to sign the same physical document, it is best practice to include a counterparts clause in the agreement which in effect creates more than one original document. However, omitting such a clause will not invalidate a document which is in fact signed in counterpart.

7. Do all parties have to use the same method of execution?

No. The parties to an agreement could validly execute a document using different methods; for example, one party signing electronically and a second using a wet ink signature. A composite version could then be created, either by using a print-out of the electronically signed page together with the wet ink signed pages, or by scanning the wet ink pages to add to the electronically signed page. If that document was later required to be produced in evidence, an English court would accept the composite version.

8. Can a company use pre-signed signature pages in the execution of a simple contract?

Yes. In February 2010, the Law Society published a practice note  on the execution of documents by virtual means, which represents its view of good practice. When executing a simple contract between two parties which are not physically present at the same meeting, it is acceptable to use pre-signed signature pages. When doing this, the signature page should clearly identify the document to which it relates. When the document is finalised, those organising the signing should email the final version of the document to each absent party (or their lawyers) and obtain confirmation from that party (or their lawyers) that they have agreed the final version, and that they authorise the pre-signed signature page to be attached to the final version and for the document to be dated and released.

9. Can one individual execute a document as both a director and the company secretary?

No. The Companies Act 2006 states that a provision requiring something to be done by a director and the company secretary is not satisfied by it being done by the same person acting both as director and secretary. The document could instead, though, be signed by the director in the presence of a witness.

10. What are the possible consequences of executing a document incorrectly?

The recent pensions case, Briggs v Gleeds , illustrates that the consequences can be severe. Gleeds was a partnership that operated a final salary pension scheme. Over a period of more than fifteen years from 1991, a number of deeds of amendment were executed making significant changes to the pension scheme, including closing the scheme to the future accrual of benefits.

It was later discovered that the partners’ signatures on these deeds had not been validly witnessed, as required under the Law of Property (Miscellaneous Provisions) Act 1989. The additional liability for Gleeds to fund the scheme, owing to the deeds having been invalidly executed, was in the region of £45 million.

The High Court held that the deeds were not valid and had no effect. Arguments that the trustees and scheme members should be “estopped” from denying the validity of the deeds did not succeed. The case is, however, due to be appealed to the Court of Appeal on a number of points.

Failure to execute contracts properly is less commonly a problem than deeds. This is because fewer formalities must be complied with when executing a simple contract. Nevertheless, it is essential that both types of document are executed properly to ensure their validity and operation as intended. Whilst the Gleeds case is indicative of the current trend that the courts take a strict approach to observing formalities within the pensions context, the principles have wider application.

* This article is current as of the date of its publication and does not necessarily reflect the present state of the law or relevant regulation.

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Practical Guide to: e-Signatures

The law and practice around use of e-signatures around the world has changed considerably as a result of the pandemic and evolving ways of working. Whilst further changes are likely, this Guide aims to summarise the current situation.

What is an e-signature?

An e-signature is:

“an electronic seal in electronic form which is incorporated into or otherwise logically associated with electronic communication or electronic data and purports to ensure the origin and integrity of the communication or data” (UK Statutory Instrument 2016/696 Regulation 1, Schedule 3, “The Electronic Identification and Trust Services for Electronic Transactions Regulations 2016”)

“data in electronic form which is attached to or logically associated with other data in electronic form and which is used by the signatory to sign ” (Regulation (EU) No 910/2014, “the eIDAS Regulation”)

“ an electronic sound, symbol, or process attached to or logically associated with a contract or other record and executed or adopted by a person with the intent to sign the record ” (US ESIGN Act, 2000)

What form can it take?

An e-signature can have many different forms, including:

Simple electronic signature – a signature in electronic form, for example:

- a typed name

• Abel + Imray

- a Text string signature (also known as S-signature)

/ABEL IMRAY/

- a Facsimile signature i.e. an image of an original handwritten signature

Advanced/Heightened /Enhanced electronic signature – wherein digital certificates are used to verify identity e.g. DocuSign® or AdobeSign TM

Qualified electronic signature – a highly secure and regulated form of e-signature having a qualified digital certificate, wherein the signature is created using a Qualified Signature Creation Device (QSCD). A Qualified electronic signature is usually obtained through the services of a qualified Trust Service Provider (TSP).

NB: This Guide does not cover practice in regard to fax communications.

Practice at the UK Intellectual Property Office (UKIPO)

Under the laws of England and Wales, e-signatures are acceptable for documents where there is a statutory right for them to be “signed” in order for them to be valid, including on assignment and license documentation. An e-signature has the same effect as an original handwritten (“wet”) signature.

The Courts have determined that varied forms of e-signature are valid, provided that the signature is capable of demonstrating an intent to sign. For example, each of the following electronic marks have been found to be valid e-signatures: a name typed at the bottom of an email, clicking an “I accept” box on a website and the header of a SWIFT message.

The UKIPO generally accepts e-signatures on all documents.

Assignments/Licenses

An assignment or license of a UK registered right (e.g. a patent, trademark or design) and associated other intellectual property can be executed with e-signatures, under the laws of England and Wales.

The UKIPO does not normally require a copy of the assignment or license documentation to action the recordal, but occasionally there may be a need to file the documentation on request.

Powers of Attorney

For UK companies, a Power of Attorney should be executed as a deed, requiring signature in the presence of a witness under the laws of England and Wales. A Power of Attorney can be executed with an e-signature, and filed at the UKIPO.

Practice at the European Patent Office (EPO)

Most documents, but not all, can be filed at the EPO with an e-signature.

The EPO permits three types of e-signature for documents filed electronically (OJ EPO 2021, A42):

• Text String signature
• Fascimile signature
• Enhanced e-signature i.e. confirmed with a digital certificate issued by or accepted by the EPO (this type of signature can only be used by Professional Representatives using a Smart Card for filing via EPO Online Filing)

Initials are not acceptable.

Special care should be taken regarding e-signatures in regard of documentation providing evidence of a transfer or license of rights, and powers of attorney.

An assignment of a European patent application (and associated other intellectual property) can only be registered if the signatures meet certain requirements.

The EPO accepts, for signatures attached to assignment/ license documents, either a traditional wet signature, or a Qualified electronic signature (OJ EPO 2021, A86). Original documentation is not required to be filed, but may be requested.

The bar for Qualified electronic signature is high, and if the signature is found to be deficient, the EPO may require further relevant documentary evidence to be supplied.

The EPO defines Qualified electronic signature as an e-signature that:

(a) is uniquely linked to and capable of identifying the person signing;

(b) is created by means that the person signing can use with a high level of confidence and over which they have sole control;

(c) is associated with the electronic document to be authenticated in such a way that any subsequent change in the data is detectable;

(d) is created by a qualified electronic signature device; and

(e) is based on a qualified certificate.

It may, in most cases, be preferable to obtain traditional wet signatures on assignment and license documents. The parties can sign in counterparts (wherein scanned copies are submitted to the EPO, and the originals are stored safely for future use if needed).

There are other formalities to be complied with for recording assignments, licenses and other such documents at the EPO. In particular, the document should contain:

• The Application Number (of the European or International (PCT) Patent Application)
• Signatures of all parties
• Job titles (for example CEO, President or Managing Director) – the signature must be of a person with authority to sign on behalf of the entity. Increasingly, authorisation to sign on behalf of a legal entity is being examined by the EPO.

Powers of Attorney:

Current best practice remains for Powers of Attorney to be signed with a traditional wet signature, and submitted to the EPO in scanned copy. The originals should be stored in case they are needed at a later time.

Practice at the EU Intellectual Property Office (EUIPO)

The EUIPO tends to accept e-signatures, including on assignment documentation.

For documents which are filed electronically, a simple indication of the sender’s name is deemed to be equivalent to a signature.

Do other foreign offices permit e-signatures?

Requirements around the world vary.

In the US, e-signatures are generally permitted by the USPTO and under US Federal and State laws. The USPTO favours the S-signature i.e. text string, which can be applied to all documents filed using the EFS-web platform including inventor declarations, information disclosure statements, powers of attorney etc. Script style fonts are generally not allowable at the USPTO.

In the US, similar to in the UK, intent is an important factor in the validity of electronically signed documents – therefore including a statement to say that all parties agree to the use of the e-signatures in the agreement may be advisable.

Some countries, for example Japan, require original assignment documents to be signed by hand. If a copy is filed, it must be notarized. The appropriate procedure for notarization can be complex, and it is important to seek advice to ensure local laws are complied with.

In many countries there are certain formalities to attend to in respect of the content and execution of the assignment or license documentation, for example, some offices may require an indication of the application number, some other offices may require signatures of one or both parties to the transaction, whilst some other offices may require the full address of the assignor to be provided.

For applications likely to be filed widely around the world, the safest approach may still be to execute assignments and license agreements with traditional wet signature to ensure they can be recorded (and have legal effect) in all required territories. In almost all jurisdictions copies can be filed at least initially, to be followed up with originals on the request of the intellectual property office.

Key points and tips for businesses:

• Check which local laws by jurisdiction are applicable to the transaction/ agreement in question, and thus determine which type of signature is required for legal validity – are e-signatures permitted?
• Consider including a Governing Law clause in documentation to state that the agreement is governed by a national law which permits e-signature
• To demonstrate intent, consider including a statement to say that all parties agree to the use of the e-signatures in the agreement
• Check the Intellectual Property Office requirements with regard to recordals of the documents – do the relevant offices accept e-signatures?
• Are there any notarisation/ witnessing requirements in any of the countries where the documents are to be registered?
• Keep hold of original documentation. This is of course important for a variety of commercial reasons as well as being important for demonstrating evidence of a transaction upon request of an intellectual property office.

Electronic signatures are generally permitted when filing documents electronically at the UKIPO, EUIPO and USPTO.

The EPO has a stricter approach, and particularly for documentation relating to assignments, licenses and powers of attorney, it may be most appropriate to use traditional wet signatures. It is now permitted to use Qualified e-signatures on documentation relating to assignments/ licenses of rights, however the standard for a Qualified e-signature is high, and may be impractical in some cases.

Requirements around the world vary, and some countries still require a handwritten wet signature on some documentation (e.g. assignment documentation).

Abel & Imray LLP is a European patent, registered designs and trade mark attorney firm with offices in the UK (London, Bath, Cardiff) and The Netherlands (Delft). Established in 1871, we are a full service firm of over 100 people, including around 50 attorneys. We develop long-term, mutually valuable relationships with our associates and clients because we care about you and your organisation. Through investing time to get to know and understand you and your business, we believe we can provide better counsel and truly become a trusted partner for the people and organisations we work with. Please visit our website at  www.abelimray.com  and contact us at  [email protected]  or +44 (0) 20 7242 9984 for further information.

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• Power of attorney

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Execution of a document using an electronic signature

This practice note should be considered in conjunction with the:

• cover statement (7 May 2020)
• practice note on execution of documents by virtual means (16 February 2010)

Save for certain updated references, this document remains in the form issued on 21 July 2016.

This practice note has been developed to help parties (and their legal advisers) who wish to:

• execute commercial contracts using an electronic signature or
• enter into a commercial contract with one or more other parties that intend to execute that contract using an electronic signature

This practice note is the Law Society’s view of good practice in this area, and is not legal advice. For more information see the legal status .

Introduction

This practice note has been prepared by a joint working party of the Law Society Company Law Committee and the City of London Law Society Company Law and Financial Law Committees (the JWP).

This practice note has been developed to help parties (and their legal advisers) who wish to execute commercial contracts using an electronic signature or who wish to enter into a commercial contract with one or more other parties that intend to execute that contract using an electronic signature.

The JWP has obtained legal advice from leading counsel (Mark Hapgood QC) on the use of electronic signatures as a valid method of executing documents. This note has been approved by leading counsel.

This practice note is limited in scope to commercial contracts entered into (and certain other documents signed) in a business context, rather than those to which consumers or other individuals outside of a business context are a party.

However, it is recognised that certain principles considered in this note may also be applicable to documents entered into in other contexts. Each transaction should be approached according to its own facts and should take into account the wider implications of the transaction, including any relevant regulatory or tax implications.

This practice note is limited to the position under English law (the position under the laws of other parts of the United Kingdom may be different). See paragraph 7 of this note for a short discussion of when English law may not be the applicable law for determining whether or not a contract has been properly executed.

Paragraph 8 of this note sets out a number of practical considerations which should be taken into account when considering whether to use an electronic signature.

At present, where the parties to a transaction are not physically at the same meeting to sign the documents, it is common for the lawyers involved to arrange a signing via email, following the procedures set out in an earlier guidance note. 1

  This typically involves the signatory signing a hard-copy document in wet-ink, converting the document and signature into electronic form (for example, by scanning or photocopying it) and sending it by email.

However, as market practice and technology evolve, the use of electronic signatures is becoming increasingly common in a range of commercial transactions and that trend is expected to continue.

Electronic signatures can take a number of different forms, including:

(a) a person typing their name into a contract or into an email containing the terms of a contract (b) a person electronically pasting their signature (for example, in the form of an image) into an electronic (soft copy) version of the contract in the appropriate place (for example, next to the relevant party’s signature block) (c) a person accessing a contract through a web-based e-signature platform and clicking to have their name in a typed or handwriting font automatically inserted into the contract in the appropriate place (for example, next to the relevant party’s signature block); and (d) a person using a finger, light pen or stylus and a touchscreen to write their name electronically in the appropriate place (for example, next to the relevant party’s signature block) in the contract

This note does not focus on any one method of electronic signature, but rather on setting out the principles for determining whether a given document signed with an electronic signature has been validly executed.

Legislative framework

Regulation (EU) No 910/2014 (the eIDAS Regulation) has direct effect in EU member states from 1 July 2016. 2 It establishes an EU-wide legal framework for electronic signatures (as well as for electronic seals, electronic time stamps, electronic registered delivery services and website authentication, all of which are outside the scope of this note).

The eIDAS Regulation defines:

a) an 'electronic signature' as 'data in electronic form which is attached to or logically associated with other data in electronic form and which is used by the signatory to sign' b) an 'advanced electronic signature' as one which meets the following requirements:

• it is uniquely linked to the signatory
• it is capable of identifying the signatory
• it is created using electronic signature-creation data that the signatory can, with a high level of confidence, use under his sole control, and
• it is linked to the data signed therewith in such a way that any subsequent change in the data is detectable, and

c) a 'qualified electronic signature' as 'an advanced electronic signature that is created by a qualified electronic signature creation device, and which is based on a qualified certificate for electronic signatures'.

Articles 25(2) and (3) of the eIDAS Regulation provide that a qualified electronic signature shall have the equivalent legal effect of a handwritten signature and that a qualified electronic signature based on a qualified certificate issued in one member state shall be recognised as a qualified electronic signature in all other member states.

However, Article 25(1) of the eIDAS Regulation also provides that an electronic signature shall not be denied legal effect and admissibility as evidence in legal proceedings solely on the grounds that it is in an electronic form or that it does not meet the requirements for qualified electronic signatures.

Furthermore, Recital 49 of the eIDAS Regulation states that (apart from the requirements for qualified electronic signatures) it is for national law to define the legal effect of electronic signatures.

As at the date of this note, qualified electronic signatures are not commonly used in England. Therefore, neither the concept of a qualified electronic signature nor the provisions of articles 25(2) and (3) of the eIDAS Regulation have been relied on in reaching the conclusions set out in this note.

The Electronic Communications Act 2000 (the ECA 2000) provides a statutory framework for the admissibility of electronic signatures in England and Wales. Section 7(1) of the ECA 2000 provides that in any legal proceedings:

(a) an electronic signature incorporated into or logically associated with a particular electronic communication or particular electronic data, and (b) the certification by any person of such a signature shall each be admissible in evidence in relation to any question as to the authenticity or integrity of the communication or data

Although the ECA 2000 deals with the admissibility of electronic signatures, it does not deal with the validity of electronic signatures. The conclusions about the validity of electronic signatures set out in this note are therefore based on wider principles of English common law.

In addition, section 8 of the ECA 2000 provides for the UK government to modify by statutory instrument (SI) any enactment which requires something to be done or evidenced in writing, to be authorised by a person’s signature or seal or to be delivered as a deed or witnessed.

Although more than 50 such SIs have been enacted under the ECA 2000, there are many statutory provisions imposing execution formalities which have not been addressed in this manner.

However, in the opinion of leading counsel and the JWP, the fact that an SI has not been enacted under the ECA 2000 in respect of a particular statutory provision imposing an execution formality does not mean that a contract subject to such provision cannot be executed using an electronic signature (and this is supported by the eIDAS Regulation).

Using electronic signatures to execute English law governed documents

Simple contracts.

In the absence of any (usually statutory) requirement, there is no need under English law for contracts to be in any particular form.

In fact, contracts can be entered into orally, provided there is offer and acceptance, consideration, certainty of terms and an intention to be legally bound.

Therefore, a simple contract may be concluded using an electronic signature.

Documents subject to a statutory requirement to be in writing and/or signed and/or under hand

A number of types of document are subject to specific formalities imposed by statute, including a requirement for the document to be in writing and/or signed and/or under hand. Examples include:

(a) section 4 of the Statute of Frauds 1677 requires a guarantee or a memorandum or note thereof to be in writing and signed by the guarantor or some other person authorised by the guarantor to do so (b) section 2 of the Law of Property (Miscellaneous Provisions) Act 1989 (the LP(MP)A 1989) requires a contract for the sale or other disposition of an interest in land in England and Wales to be in writing and signed (c) section 53(1) of the Law of Property Act 1925 (the LPA 1925) requires a disposition of an equitable interest to be in writing, signed by the person disposing of it or by his properly authorised agent (d) a statutory assignment within section 136 of the LPA 1925 must (among other requirements) be in writing and signed by the assignor (e) under section 83 of the Bills of Exchange Act 1882 , a promissory note must (among other requirements) be in writing and signed by the maker (f) under section 90(3) of the Copyright, Designs and Patents Act 1988 , an assignment of copyright is not effective unless it is in writing signed by or on behalf of the assignor, and (g) under section 1(1) of the Stock Transfer Act 1963 , registered securities may be transferred by means of an instrument under hand in the form set out in schedule 1 to the act.

In the opinion of leading counsel and the JWP, a contract executed using an electronic signature (and which may exist solely in electronic form) satisfies a statutory requirement to be in writing and/or signed and/or under hand for the following reasons.

(i) Writing: The Interpretation Act 1978 defines 'writing' to include 'typing, printing, lithography, photography and other modes of representing or reproducing words in a visible form'. Where the contract is represented on a screen (including a desktop, laptop, tablet or smartphone) in a manner which enables a person to read its terms properly, it will be 'in writing' at that point. For example, in Golden Ocean Group Limited v Salgaocar Mining Industries PVT Ltd and another [2012] EWCA Civ 265 (Golden Ocean), the Court of Appeal found that the exchange of a number of emails could lead to the conclusion of an agreement in writing for the purposes of the Statute of Frauds 1677. (ii) Signature: The test for determining whether or not something is a signature is whether the mark which appears in a document was inserted in order to give, and with the intention of giving, authenticity to it. Therefore, provided that the signatory inserts an electronic signature into the appropriate place (eg next to the relevant party’s signature block) in a document with the intention of authenticating the document, a statutory requirement for that document to be signed will be satisfied. It does not matter how the signatory inserted the electronic signature into the document (eg using any of the methods specified in paragraphs 2(a)-(d) above), nor does it matter in what form that signature was inserted (eg a handwritten signature, a generic handwriting font, a typed font, etc.). Leading counsel has advised that J Pereira Fernandes SA v Mehta [2006] EWHC 813 (Ch) is authority that typing a name into an email satisfies a statutory requirement for a document to be signed (and this position was confirmed in Green (Liquidator of Stealth Construction Ltd) v Ireland [2011] EWHC 1305 (Ch)) and Golden Ocean is authority that an electronic signature has the same legal status as a wet-ink signature, the key question being whether or not the purpose of the signature is to authenticate the document. (iii) Under hand: A document is generally understood to have been executed under hand if it has been executed otherwise than by deed. The insertion of an electronic signature with the relevant authenticating intention would be sufficient for a document to have been executed under hand.

At common law, a deed must be in writing. Given the willingness of the courts to interpret various statutory requirements for writing to include the situation where a document is represented on a screen and executed with an electronic signature, in the opinion of leading counsel and the JWP, the approach outlined above would apply in respect of deeds.

For the execution of deeds:

(a) Section 46 of the Companies Act 2006 (the CA 2006) provides that a document is validly executed as a deed by a company incorporated under the CA 2006 if it is duly executed and is delivered as a deed.

• (i) section 44 of the CA 2006 provides that one of the ways in which a document can be validly executed by a company incorporated under the CA 2006 is by signature by two directors or by one director and the company secretary (authorised signatories). In the opinion of leading counsel and the JWP, this can be achieved by each of two authorised signatories signing the deed (using an electronic signature or another acceptable method) either in counterpart or by one authorised signatory signing, followed by the other adding his or her signature to the same version (electronic or hard copy) of the deed.
• (ii) In the opinion of leading counsel and the JWP, delivery can be achieved through electronic signing, but the parties will have to take steps to ensure the signing arrangements adequately address when delivery takes place, particularly if the parties propose that their lawyers hold their signed documents to the order of the relevant party prior to the deed coming into effect.

(b) section 1(3) of the LP(MP)A 1989 provides that an instrument is validly executed as a deed by an individual (including an individual acting under a power of attorney) if it is signed by him in the presence of a witness who attests the signature (and, by section 1(4), 'sign' includes making ones mark on the instrument). Section 44 of the CA 2006 provides that another of the ways in which a document can be validly executed by a company incorporated under the CA 2006 is if it is signed on behalf of the company by a director of the company in the presence of a witness who attests the signature. In the opinion of leading counsel and the JWP, where a suitable signatory signs a deed using an electronic signature and another individual genuinely observes the signing (ie he or she has sight of the act of signing and is aware that the signature to which he or she is attesting is the one that he or she witnessed), he or she will be a witness for these purposes. If that witness subsequently signs the adjacent attestation clause (using an electronic signature or otherwise), that deed will have been validly executed. The practical means of witnessing different forms of electronic signature will need to be settled on a case-by-case basis, with consideration given to the evidential weight of the form agreed (see paragraph 5 below). However, in the opinion of leading counsel and the JWP, it is best practice for the witness to be physically present when the signatory signs, rather than witnessing through a live televisual medium (such as a video conferencing facility), in order to minimise any evidentiary risk as to whether the person genuinely witnessed the signing.

Coronavirus (COVID-19) update 

Specific HM Land Registry COVID-19 requirements:

Electronic signatures

HM Land Registry will accept deeds that have been signed using the Mercury signing approach (option 1 in the Mercury practice note ).

For land registration purposes, a signature page will need to be signed and witnessed in pen and then captured, with a scanner or a camera, to produce a PDF, JPEG or other suitable copy of the signed signature page. Each party sends a single email to their conveyancer to which is attached the final agreed copy of the document and the copy of the signed signature page.

Physical witnessing

HM Land Registry practice will continue to reflect its view that it would be unsafe to accept any form of witnessing other than contemporaneous, physical witnessing, as being sufficient for the purposes of section 1(3) of the Law of Property (Miscellaneous Provisions) Act 1989.

Companies incorporated under the CA 2006: minutes and resolutions

Leading counsel has advised that:

(a) a document (including minutes of a directors’ meeting under section 249 of the CA 2006 and a members’ written resolution under section 296 of the CA 2006) signed with an electronic signature by a person and sent or supplied to a company will have been sufficiently authenticated for the purposes of section 1146 of the CA 2006 if:

• it is sent or supplied in hard copy form by or on behalf of the person who signed it, or
• it is sent or supplied in electronic form, provided that the identity of the sender is confirmed in a manner specified by the company or (where no such manner has been specified by the company) if the communication contains or is accompanied by a statement of the identity of the sender and the company has no reason to doubt the truth of that statement

(b) minutes of the proceedings of a general meeting that are signed by the chairman using an electronic signature constitute evidence of the proceedings of that meeting in accordance with section 356(4) of the CA 2006 and a record of a resolution passed otherwise than at a general meeting that is signed by a director or the company secretary using an electronic signature constitutes evidence of the passing of that resolution in accordance with section 356(2) of the CA 2006, and

(c) the directors of a company that has adopted the CA 2006 Model Articles for private companies limited by shares, the CA 2006 Model Articles for public companies limited by shares or the Companies Act 1985 Table A articles may take a decision or pass a directors’ written resolution (as applicable) under those articles by the relevant directors signing a resolution using an electronic signature.

Using a combination of execution methods

If one (or some) parties to a document (including any witnesses) wish to sign using an electronic signature, while another (or others) would prefer to use another acceptable method (eg a wet-ink signature), there is no reason why the document cannot be signed using a combination of different methods, so long as each party uses a valid signature method, although there may be practical advantages (eg electronic storage) if a document is created only in an electronic process.

Evidential weight

Section 7 of the ECA 2000 provides that, in any legal proceedings, an electronic signature incorporated into a particular electronic communication shall be admissible in evidence in relation to any question as to the authenticity of that communication or as to the integrity of that communication.

Leading counsel has advised that, if the authenticity of a document signed using an electronic signature were to be challenged, an English court would accept the document bearing the electronic signature as prima facie evidence that the document was authentic and, unless the opponent adduced some evidence to the contrary, that would be sufficient to deal with the challenge. These are the same principles that an English court would apply in relation to wet-ink signatures.

The person alleging that the document was not authentic (for example, produced fraudulently, not signed by the person who had purportedly done so or not properly witnessed) would need to prove, on a balance of probabilities, that this was the case.

The Code of Conduct of the Solicitors Regulation Authority provides that a solicitor should not allege fraud without material which he or she reasonably believes shows, on the face of it, a case of fraud.

Under the Bar Standards Board Code of Conduct , it is necessary to have reasonably credible material which establishes an arguable case of fraud before a barrister can plead fraud. Although it would not (in the absence of handwriting) be possible to adduce evidence of a handwriting expert, there is a spectrum of evidence that might be used to prove the authenticity of a particular signature.

It may be possible, for example, to show:

(i) that the purported signatory or witness accessed the electronic document via his or her email account or computer (ii) the location in which it was accessed (iii) that he or she used a password and/or PIN or encryption key in order to access the document (if that was the case) (iv) the time at which he or she applied his or her signature, and/or (v) that the document had not been amended between when it was uploaded to the electronic signature platform and when the final signatory executed it.

On certain transactions solicitors may be involved in checking the identity of a signatory, the authenticity of a signature and/or the question of whether or not a document has been properly approved.

On other transactions, the identity, authenticity and approval may be assumed. The use of electronic signatures will not change this.

Originals and counterparts

(a) it is possible, depending on the facts, to have multiple originals of a document in both electronic and hard-copy form (including, for example, where the parties intend for multiple originals to be produced in electronic and/or hard-copy form), but it would not be appropriate if it would conflict with other legal requirements (as would be the case with, for example, promissory notes)

(b) where a document has been executed electronically with each signatory applying his or her signature to the same file uploaded to the relevant electronic signature platform, the signatories will be deemed to have signed the same counterpart

(c) where a document has been executed electronically, there is no need as a matter of English law for an additional wet-ink version to be executed, although there may be practical reasons for doing so (see paragraphs 7(b) and 8(d))

(d) where a document has been executed using a combination of electronic and wet-ink signatures, the parties or their legal advisers may wish to create a composite document (either by using a hard-copy print out of the electronically-signed document and the wet-ink signed pages or by scanning the wet-ink signed pages and creating a composite electronic document) and to the extent that the document is required to be produced in evidence, an English court would accept this composite document

(e) to the extent that an original of a document executed electronically is required to be produced in evidence, an English court would accept an electronic version of that executed document or a hard-copy print out

(f) where an undated document is executed electronically, it may be validly dated with the authority of the parties (i) by inserting the date electronically or (ii) by printing it out and inserting the date by hand, and

(g) after a document has been executed electronically, amendments may be made to it (electronically or in manuscript) to the same extent as amendments may be made in manuscript to a document executed in wet-ink

Conflicts of law issues

In certain circumstances, the parties to a document to be signed using an electronic signature may wish to seek advice from counsel in another jurisdiction. For example:

(a) Where a document governed by English law is to be executed by an overseas company 3  

• In any litigation in the English courts, the courts will be obliged to apply article 11 of Regulation (EC) No 593/2008 on the law applicable to contractual obligations (the Rome I Regulation) to determine questions as to which law should be applied to ascertain whether or not a contract is formally valid (assuming it is a civil and commercial matter and its subject matter is not excluded from the Rome I Regulation). Article 11 of the Rome I Regulation provides that one of the ways in which a contract is formally valid is if it satisfies the formal requirements of the law which governs it (although this rule does not apply to consumer contracts and there are specific provisions to be considered for contracts concerning rights in rem in immovable property and for tenancies of immovable property). Therefore, for matters within the scope of the Rome I Regulation, in any action brought in the English courts, a contract governed by English law will be upheld as validly executed so long as it has been validly executed as a matter of English law.
• Section 44(1) of the CA 2006, as modified by the Overseas Companies (Execution of Documents and Registration of Charges) Regulations 2009 (PDF) , provides that, as a matter of English law, a document (including a deed) can be validly executed by an overseas company: (x) by the affixing of the company’s common seal; (y) if it is executed in any manner permitted by the laws of the territory in which the company is incorporated for the execution of documents by such a company; or (z) if it is signed by a person who, in accordance with the laws of the territory in which the company is incorporated, is acting under the authority (express or implied) of the company and it is expressed (in whatever form of words) to be executed by the company.
• Therefore, if an overseas company executes an English law governed contract using an electronic signature, provided that the relevant signatory is (as a matter of the laws of the territory in which the company is incorporated) acting under the authority (express or implied) of the company, that contract will have been validly executed as a matter of English law. The question of the authority of a signatory, including any limitations on the scope of that authority and the manner in which the company binds itself (whether signature by electronic means is excluded), is a matter of the laws of the territory in which the company is incorporated (as is the question of that company’s capacity).

(b) Where any litigation, or other action, in relation to a document governed by English law may take place, or be required, outside England: Examples include where

• there is a foreign jurisdiction clause in an English law contract
• an English judgment needs to be enforced in another jurisdiction
• (a claim needs to be made in a non-English insolvency proceeding
• a document needs to be notarised or apostilled, and
• a registration needs to be made at a non-English registry. In such circumstances, parties may wish to seek local law advice in advance of signing by electronic signature. Where such action may take place elsewhere in the European Union, parties may wish to consider the feasibility of using a qualified electronic signature (see paragraph 3 of this note)

(c) Where a document is governed by a law other than English law

  Whether or not such a document can be validly executed using an electronic signature and the steps required in order for such an execution to be valid are matters of the governing law and, in some jurisdictions, the impact of the law of the forum where the document is relied upon and are beyond the scope of this note.

Certain other considerations

This practice note is limited to the question of whether or not an electronic signature can be used to validly execute a commercial contract as a matter of English law.

However, where one or more parties to a contract are contemplating using an electronic signature, there are a number of other legal and practical matters which they or their legal advisers might need to consider, including the following.

(a) Does an entity intending to execute the contract using an electronic signature have the corporate capacity and authority to do so? This will depend on the facts, but should not differ from the position where the party is executing the contract with a pen, unless there is something in its constitutional documents or board resolutions restricting it from using an electronic signature. In the absence of any specific restriction, it is not necessary to include a reference to electronic signature in any board resolution or for the constitutional documents to specifically reference the fact that the entity can enter into agreements or transactions which are signed electronically.

(b) Is there sufficient certainty that the person purporting to sign using an electronic signature is in fact that person or acting under the authority of that person? Factors that might assist in this respect include (in particular, where the contract has been executed through an e-signing platform) whether the signatory had accessed the document using a particular email address or by inputting a unique access code and whether or not this can be confirmed (via a certificate or otherwise) by the platform provider.

(c) Is the document to be distributed, signed and held electronically in a manner which is sufficiently secure? This will depend on the method used and on the degree of importance placed on IT security by the parties in question (for example, how valuable is the contract; how important is it to keep it confidential?), so it is something that each party should consider on a case-by-case basis and draw its own conclusions.

(d) Where the document needs to be filed with an authority or registry, will that authority or registry accept electronic signatures? For example, as at the date of this note:

• HM Land Registry and the Land Charges Registry require a wet-ink signature on a paper version of any document submitted to them for registration (although the Land Registry has announced plans to launch an electronic mortgage service)
• Companies House will accept a certified copy of a charging document executed using an electronic signature in satisfaction of the registration requirements under Section 859A of the CA 2006 (although, outside of its web-filing service, it still requires a wet-ink certification of the copy); and
• where stamp duty is payable on a document, HM Revenue and Customs would normally expect to stamp a version of the document with a wet-ink signature

(e) If the place of signature or the location of the document has particular legal consequences (eg in relation to the payment of stamp duty), where will a document executed using an electronic signature be treated as having been executed or located? The answer may depend upon a number of factors, including where the signatory is physically located when signing and where the server on which the document is stored is located. In such circumstances, it may be better to have a physical signing.

(f) Where a party wishes to execute a deed by the physical affixing of its common seal, it is unlikely to be possible to do this electronically (although the eIDAS Regulation and the ECA 2000 provide for the creation and use of electronic seals, these are not, so far as the JWP is aware, currently in use in England).

(g) It is not necessary to include any specific reference to electronic signatures in the document itself in order for it to be validly executed using an electronic signature.

This note refers to certain EU regulations, the status of which under English law may be affected by the United Kingdom ceasing to be a member of the European Union.

The Joint Working Party - disclaimer

13 July 2016

This note was developed by a joint working party of the Law Society Company Law Committee and the City of London Law Society Company Law and Financial Law Committees and has been approved by leading counsel.

The aim of this note is to make suggestions only and not to give advice.

No duty of care or liability whatsoever is accepted by those involved in the preparation or approval of this note, or the firms or organisations that they represent, to any company or individual who relies on material in it.

1   Note on Execution of Documents at a Virtual Signing or Closing (PDF) prepared by a joint working party of the Law Society, prepared by a joint working group of the Law Society Company Law Committee and The City of London Law Society Company Law and Financial Law Committees in May 2009. 2 The ECA 2000 and the Electronic Signatures Regulations 2002, derived in part from Directive 1999/93/EC, previously applied in England and Wales. The eIDAS Regulation repealed Directive 1999/93/EC with effect from 1 July 2016 and the Electronic Identification and Trust Services for Electronic Transactions Regulations 2016 amended the ECA 2000 and repealed the Electronic Signatures Regulations 2002 with effect from 22 July 2016, subject in both cases to certain transitional provisions. 3 That is, a company which is not incorporated under the CA 2006.

Legal status  

Practice notes represent the Law Society’s view of good practice in a particular area. They are not intended to be the only standard of good practice that solicitors can follow. You are not required to follow them but doing so will make it easier to account to oversight bodies for your actions.

Practice notes are not legal advice, and do not necessarily provide a defence to complaints of misconduct or poor service. While we have taken care to ensure that they are accurate, up to date and useful, we will not accept any legal liability in relation to them.

For queries or comments on this practice note contact our Practice Advice Service .

SRA Principles

There are seven mandatory principles in the SRA Standards and Regulations which apply to all aspects of practice. The principles apply to all authorised individuals (solicitors, registered European lawyers and registered foreign lawyers), authorised firms and their managers and employees, and to the delivery of regulated services within licensed bodies.

Terminology  

Must – a requirement in legislation or a requirement of a principle, rule, regulation or other mandatory provision in the SRA Standards and Regulations. You must comply, unless there are specific exemptions or defences provided for in relevant legislation or regulations.

Should – outside of a regulatory context, good practice, in our view, for most situations. In the case of the SRA Standards and Regulations, a non-mandatory provision, such as may be set out in notes or guidance.

These may not be the only means of complying with legislative or regulatory requirements and there may be situations where the suggested route is not the best route to meet the needs of a particular client. However, if you do not follow the suggested route, you should be able to justify to oversight bodies why your alternative approach is appropriate, either for your practice, or in the particular retainer.

May – an option for meeting your obligations or running your practice. Other options may be available and which option you choose is determined by the nature of the individual practice, client or retainer. You may be required to justify why this was an appropriate option to oversight bodies.

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Deeds and electronic signatures

It is generally agreed that contracts may be signed electronically, and the use of electronic signature platforms such as DocuSign to execute contracts is commonplace.

Electronic signatures are less widely used for deeds , and we have yet to see a case that confirms that a deed may be signed electronically. Some practitioners therefore take a cautious approach and recommend that deeds are signed in manuscript.

During the coronavirus outbreak, however, insisting on wet-ink signatures may cause difficulties, and parties may prefer to use electronic signatures. Would this be valid for deeds?

Both the Law Society and the Law Commission are of the opinion that an electronic signature may be used to execute a deed, provided that the deed is in writing, the signature is inserted in the deed in order to authenticate it, and the signature is witnessed as required.

Since writing is defined by statute to include ‘modes of representing or reproducing words in a visible form’, it is considered that a deed will be validly signed if the signatory:

• types their name into the signature block of a Word or pdf version of the document;
• pastes an image of their signature into the signature block of the document;
• uses a stylus to write their name electronically in the signature block of the document; or
• uses an electronic signature platform (such as DocuSign or Adobe Sign) to insert their signature (either as an image or in a typed or handwriting font) into the signature block of the document as rendered by the platform.

The first option – a typed signature – is not recommended for deeds, since there is little to distinguish a genuine signature from a forgery.

It may be considered best practice to use an electronic signature platform , since in case of dispute the metadata will provide corroborative evidence as to who signed the document and when.

If a deed is executed by an individual, the individual’s signature must be witnessed. It is necessary for the witness to be physically present with the signatory when the deed is signed (whether in manuscript or electronically): witnessing by video is not thought to be acceptable . The witness must attest the signature by signing the deed themselves, and may sign electronically in the same way as the signatory.

During the coronavirus lockdown, it may difficult for a signatory to sign in the presence of an independent witness. In these circumstances, it may be appropriate to ask a family member to witness the signature. An independent witness is usually preferred for evidential reasons – if, say, a woman has signed a deed with her husband as witness, it may be necessary to call him to give evidence against her if she later denies having signed. But there is no rule of law against using a family member as a witness, and a deed will be validly executed if witnessed in this way. The witness should be aged 18 or over.

If a company is to execute a deed, it may be preferable to use the alternative method of signature by two directors, or by one director and the company secretary (rather than by one director whose signature is witnessed). This is straightforward and avoids the need for witnessing altogether. The directors may sign electronically and do not need to sign the same copy. A limited liability partnership may similarly execute a deed by signature of two members.

It may be worth checking with the other parties to the deed that they will accept an electronic signature, or witnessing by a family member, before proceeding.

If a signatory has access to a printer and scanner, they may prefer to sign in manuscript and send a scan of their signature by email. If this method is used for a deed, it is necessary for the signatory to attach the full text of the deed, as a Word or pdf file, as well as a scan of their signed signature page, to the same email, to associate their signature with the deed.

Finally, it is worth noting that certain documents must still be signed in manuscript , including the following:

• a deed to be registered at Land Registry , which will accept only an original deed signed in manuscript (apart from the special system for digital mortgages);
• a will , to which special requirements apply; or
• a lasting power of attorney , since the Office of the Public Guardian will accept only an original manuscript signature for registration.

Where shares are transferred for a purchase price of more than £1,000, it is usually the case that the stock transfer form should be signed in manuscript, because HMRC will accept only an original manuscript signature for stamping. This rule has been relaxed during the coronavirus outbreak , however, so that a stock transfer form may currently be signed electronically.

Ashfords can arrange for documents to be executed using DocuSign on request. It is not necessary for signatories to have a DocuSign account – all that is needed is an email address for each signatory.

For more information on the article above please contact  Brendan Biggs or Andrew Betteridge  

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DEED OF ASSIGNMENT: EVERYTHING YOU NEED TO KNOW.

A Deed of Assignment refers to a legal document in which an assignor states his willingness to assign the ownership of his property to the assignee. The Deed of Assignment is required to effect a transfer of property and to show the legal right to possess it. It is always a subject of debate whether Deed of Assignment is a contract; a Deed of Assignment is actually a contract where the owner (the “assignor”) transfers ownership over certain property to another person (the “assignee”) by way of assignment. As a result of the assignment, the assignee steps into the shoes of the assignor and assumes all the rights and obligations pertaining to the property.

In Nigeria, a Deed of Assignment is one of the legal documents that transfer authentic legal ownership in a property. There are several other documents like a deed of gifts, Assent, etc. However, this article focuses on the deed of assignment.

It is the written proof of ownership that stipulates the kind of rights or interests being transferred to the buyer which is a legal interest.

Read Also: DIFFERENCE BETWEEN TRANSFER OF PROPERTY THROUGH WILLS AND DEED OF GIFT

CONTENTS OF A DEED OF ASSIGNMENT

Content of a Deed of Assignment matters a lot to the transaction and special skill is needed for a hitch-free transaction. The contents of a deed of assignment can be divided into 3 namely; the introductory part, the second (usually the operative part), and the concluding part.

• THE INTRODUCTORY PART: This part enumerates the preliminary matters such as the commencement date, parties in the transaction, and recitals. The parties mentioned in the deed must be legal persons which can consist of natural persons and entities with corporate personality, the name, address, and status of the parties must be included. The proper descriptions of the parties are the assignor (seller) and assignee (buyer). The Recitals give the material facts constituting the background to the current transaction in chronological order.
• THE SECOND PART (USUALLY THE OPERATIVE PART): This is the part where the interest or title in the property is actually transferred from the assignor to the assignee. It is more like the engine room of the deed of assignment. The operative part usually starts with testatum and it provides for other important clauses such as the consideration (price) of the property, the accepted receipt by the assignor, the description of the property, and the terms and conditions of the transaction.
• The testimonium : this shows that all the parties are involved in the execution of the deed.
• Execution : this means signing. The capacity of the parties (either individual, corporate bodies, illiterates) is of great essence in the mode of execution.  It is important to note that the type of parties involved determines how they will sign. Example 2 directors or a director/secretary will sign if a company is involved. In the same way, if an association, couple, individual, illiterate, family land (omonile), firm, unregistered association, etc. is involved the format of signature would be different.
• Attestation : this refers to the witnessing of the execution of the deed by witnesses.

For a Deed of Assignment to be effective, it must include a column for the Governor of the state or a representative of the Government where the property is, to sign/consent to the transaction. By virtue of Sec. 22 of the Land Use Act, and Sec. 10 Land Instrument Registration Law, the Governor must consent to the transaction.

Do you have any further questions? feel free to call Ibejulekkilawyer on 08034869295 or send a mail to [email protected] and we shall respond accordingly.

Disclaimer: The above is for information purposes only and should not be construed as legal advice. Ibejulekkilawyer.com (blog) shall not be liable to any person(s) for any damage or liability arising whatsoever following the reliance of the information contained herein. Consult us or your legal practitioner for legal advice.

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08 Jun 2023, 3:11 pm

Many electronic signature platforms can establish enough evidence to prove intention, should someone later dispute the validity of the contract. This includes, we believe, for creating a deed under English law.

Electronic signatures should not be relied upon in all circumstances, however. Some statutory bodies, for example HM Revenue & Customs and the Land Registry, do not yet accept all documents signed electronically and there are complications around witnessing electronic signatures. You should take advice on your particular circumstances to understand whether an electronic signature will suffice.

Electronic signature platforms

In this guide we focus on using simple electronic signature platforms to sign contracts and deeds. These platforms typically let you upload a document for signing to a secure cloud-based environment and from there set up a document for signing.

The process involves the signatories accessing the document via a link. Access to it may be PIN-protected. When they sign the document, the platform captures core information such as the signatory's email address, IP address, date and time of access and any PIN entered. When the document is complete it is circulated as a read-only PDF and will highlight if the document has been altered since the signatures were added.

These platforms give a greater degree of control and collate more evidence of an intention to sign than a typical e-commerce website or pasting of a facsimile or JPEG image of a handwritten signature.

Common law in England and Wales

In general, there is no prescribed method of entering into contract, although there are some statutory exceptions. A contract need not be in writing as long as the essential elements for a contract can be established.

The contract essentials for standard contracts are that there is an offer, acceptance, agreed terms, consideration and an intention to be bound.

For deeds, the position is slightly different. There must be an offer, acceptance, agreed terms, an intention to be bound, and other particular formalities are needed.

The requirements of offer, acceptance and agreed terms are a question of substance, rather than form. If a contract when printed out meets those requirements, its electronic equivalent would similarly meet them. Consideration in contract law refers to the specific thing of value that is being exchanged through the agreement of the contract. Consideration is a question of fact. The method of execution is irrelevant.

The requirements of intention to be bound and the particular formalities for deeds are explained further below.

Capturing intention to be bound

Common law does not prescribe a type of signature. Whether a contract or other form of agreement is said to have been signed is very much a question of intention. Did the person apply their mark – by virtue of signature, completing a check box, applying an electronic signature, or clicking an "I accept" button, for example –  to evidence their intention to enter into the contract?

Electronic signature platforms typically use language that indicates to the signatory that they must apply their 'signature' to sign the contract. We think these platforms, when considered alongside email traffic that would usually surround legal completion of documents, can produce sufficient evidence to demonstrate an intention on the part of the signatory to enter into the contract.

Formalities for deeds

There are four core requirements needed to constitute a deed. It must be:

In writing – the Interpretation Act 1978 and case law, including Golden Ocean Group and J Pereira Fernandes SA , supports the notion that electronic documents are "in writing".

Expressed to be a deed – this requirement can be achieved through the wording of the contract or document.

Delivered as a deed – delivery need not be physical. It is a question of intention – delivery occurs when the parties intend it to. The arrangements for delivery of electronic deeds need not be any different than for wet ink deeds.

Executed as a deed – this requirement is governed by statute and differs depending on the parties involved. For example, section 1(3) of the Law of Property (Miscellaneous Provisions) Act 1989 applies for individuals; section 44(2) of Companies Act 2006 for companies and LLPs; the Overseas Companies (Execution of Documents and Registration of Charges) Regulations 2009 for foreign companies; and section 74 of Law of Property Act 1925 for local authorities.

The most significant hurdle for simple electronic signature platforms is meeting requirements for deeds to be witnessed, for example when an individual executes a deed or a corporate director executes in the presence of a witness. The creation of an electronic signature - connecting two pieces of data - is not something that can be witnessed, but the signatory's actions in making that connection can. Whilst the law is not certain, we think an electronic signature can be witnessed.

Statutory law and recommendations for reform

There is no statutory or case law authority confirming that simple electronic signatures can be used to execute deeds. So we cannot be certain that simple electronic signature platforms can validly create deeds.

The EU's eIDAS regulation, on electronic identification and trust services for electronic transactions in the internal market, and the UK's Electronic Communications Act 2000 allow electronic signatures to be admissible in evidence, but neither piece of legislation confirms they are legally valid. They confirm that qualified electronic signatures satisfy any legal requirements in the same way as handwritten signatures. However, simple electronic signature platforms cannot create qualified electronic signatures.

A Law Commission report into electronic signatures , issued in September 2019, gives a great deal of comfort. The report found:

• The combination of eIDAS, domestic legislation and case law means that an electronic signature is capable of meeting a statutory requirement for a signature if an authenticating intention can be demonstrated
• An electronic signature can be witnessed. Although a witness may not be able to see the digital information, they can see the signatory purporting to add their signature to a document on the screen
• 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
• The requirement that deeds must be delivered does not impede the electronic execution of deeds in practice.

The Ministry of Justice, at the recommendation of the Law Commission, set up an industry working group (IWG) to further consider the Law Commission report and the legal position in relation to electronic signatures. The IWG published an interim report  in February 2022 in which it identified best practice guidance based on existing technology, including specific considerations for vulnerable individuals, and made recommendations for law reform. In its final report , published in March 2023, the IWG considered the challenges arising from the use of electronic signatures in cross-border transactions; how to address them; and how best to use electronic signatures to optimise their benefits when set against the risk of fraud. The final report also set out the IWG's recommendations for legal reform.

Whilst neither the Law Commission findings nor the reports published by the IWG create or state the law, we think they will be influential should any test case come before the courts. It makes it more likely that a court would find an electronic signature to be a valid method of executing a deed.

The risks of using simple electronic signature platforms

There are three principal risks in using a simple electronic signature platform to enter into deeds and contracts:

• The counterparty or a third party argues there is no contract because an electronic signature is not a valid method of entering into a contract
• The counterparty or a third party argues that the simple electronic signature platform cannot meet the formalities required to execute a deed
• The counterparty argues that it did not in fact sign the contract, someone else did it fraudulently, without authority or by mistake

We look at these three risks.

Electronic signature validity

There are several cases establishing the principle that a contract can be entered into by exchange of email. On the basis that a typewritten signature in an electronic document has been found sufficient to satisfy a statutory requirement that a contract must be in writing and signed, we think the risk that a court finds a simple electronic signature platform to be incapable of creating a contract is minimal. It is the intention of the parties that is important. The typical process for electronic signing and the narrative that will precede it: negotiation of terms and correspondence indicating that a contract will be sent out for signing electronically, can all help evidence an intention to create a contract.

Validity for deeds

There is the risk that whilst a contract can be created using a simple electronic signature platform, a deed cannot. The Law Commission report dismisses this. Additionally, companies and LLPs can create a deed without the need for a witness: if two authorised signatories sign, such as two directors, or two members. This sidesteps the concerns around witnessing electronic signatures. We think it very likely that a court would find a contract executed by two directors of a company using simple electronic signatures, with the appropriate audit trail to evidence the offer, acceptance, agreed terms, intention and delivery, to be a valid method of creating a deed.

Fraud, authority, mistake

If a signatory's email account were compromised, the contract could appear to have been signed by the correct person, when in fact it was not. The same risk applies to ‘virtual completions’ under current practice, though with hard copy deeds there is the theoretical safeguard that the signature can be checked against a verified signature of the signatory.

The question of authority to enter into a contract is the same for electronic signatures as it is for wet ink signatures. Appropriate investigation should be made to ensure that the person signing actually has the authority, deemed or explicit, to bind the organisation. These sorts of checks will also likely root out any likelihood of the contract being entered into by mistake.

Where simple electronic signatures may not work

There are some circumstances which demand a little more attention before using simple electronic signatures, either for practical or legal reasons. These include:

• Documents to be registered at HM Land Registry - while HM Land Registry accepts registration documents that are signed using simple electronic signature platforms, there are particular criteria that must be met and processes followed before any documents signed electronically will be accepted for registration and so not all transactions will lend themselves to electronic signatures
• Statutory declarations – statutory declarations are 'made' rather than signed or executed. The Law Society has said "it remains the custom for the declarant to be physically present before the solicitor or commissioner of oaths at the time of taking the declaration". In these circumstances a wet ink signature is just as simple as an electronic signature. However, a temporary relaxation was introduced in April 2020 to allow virtual statutory declarations in insolvency proceedings
• Documents executed by foreign companies – each will depend on its own circumstances but there is a risk, unless specific local legal advice confirms otherwise, that the company may not be legally able to execute documents using electronic signatures or that there are specific criteria that must be met in order to validly execute documents electronically.

We recognise that there is some uncertainty in the law but are confident that should a test case come to court, courts would find that simple electronic signatures, under English law, can be witnessed if the witness is physically present, and so can be used to create deeds.

The fundamental formalities for deeds are still necessary and there are certain documents for which simple electronic signature platforms are not appropriate, but for many transactions we think simple electronic signature platforms can be a cost effective, quick and environmentally friendly way to enter into deeds and contracts.

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