In September the Law Commission published a report on the electronic execution of documents. The report includes the Commission’s conclusions regarding the validity of electronic signatures and is a useful guide as to the current state of the law surrounding electronic signatures. The report found:

1.     An electronic signature is capable in law of being used to execute a document (including a deed) provided that (i) the person signing the document intends to authenticate the document and (ii) any formalities relating to execution of that document are satisfied.

2.     Such formalities may be required under a statute or statutory instrument, or may be laid down in a contract or other private law instrument under which a document is to be executed. The following are examples of formalities that might be required:

•       that the signature be witnessed; or

•       that the signature be in a specified form (such as being handwritten).

3.     An electronic signature is admissible in evidence in legal proceedings. It is admissible, for example, to prove or disprove the identity of a signatory and/or the signatory’s intention to authenticate the document.

4.     Save where the contrary is provided for in relevant legislation or contractual arrangements, or where case law specific to the document in question leads to a contrary conclusion, the common law adopts a pragmatic approach and does not prescribe any particular form or type of signature. In determining whether the method of signature adopted demonstrates an authenticating intention the courts adopt an objective approach considering all of the surrounding circumstances.

5.     The Courts have, for example, held that the following non-electronic forms amount to valid signatures:

•       signing with an “X”;

•       signing with initials only;

•       using a stamp of a handwritten signature;

•       printing of a name;

•       signing with a mark, even where the party executing the mark can write; and

•       a description of the signatory if sufficiently unambiguous, such as “Your loving mother” or “Servant to Mr Sperling”.

6.     Electronic equivalents of these non-electronic forms of signature are likely to be recognised by a court as legally valid. There is no reason in principle to think otherwise.

7.     The courts have, for example, held that the following electronic forms amount to valid signatures in the case of statutory obligations to provide a signature where the statute is silent as to whether an electronic signature is acceptable:

•       a name typed at the bottom of an email;

•       clicking an “I accept” tick box on a website; and

•       the header of a SWIFT message.

8.     The Law Commission’s view is that the requirement under the current law that a deed must be signed “in the presence of a witness” requires the physical presence of that witness. This is the case even where both the person executing the deed and the witness are executing / attesting the document using an electronic signature.

Recommendations

The Law Commission recommended an industry working group (“IWG”) to consider practical issues and provide best practice guidance for the use of electronic signatures. The IWG should also consider potential solutions to the practical and technical obstacles to witnessing electronic signatures by video link rather than the witness being physically present. Taking that a step further, the IWG recommended a review of the law of deeds and whether they remain fit for purpose.

Finally, the Commission recommended that Government consider codifying the law on electronic signatures to improve the accessibility of the law.