Update on Electronic Execution of Documents

In our autumn 2019 Briefing we welcomed the Law Commission’s final report on Electronic Execution of Documents and set out our views on certain practical matters including the crucial question of whether those documents requiring attestation of the primary signature by a witness necessitated the physical presence of the witness at the point of signature.

Our view was that such physical presence was still necessary, but in view of widespread technical developments since the pandemic began the question has arisen as to whether that remains the case. The answer has been provided by a very recent Law Society analysis with the benefit of the input of specialist Leading Counsel which has concluded that the law has not changed:

“… in the opinion of Leading Counsel …, a witness should be physically present when the signatory signs, rather than witnessing through a live televisual medium (such as a video conferencing facility).

This view is endorsed by the Law Commission who state in the 2019 Law Com Report:

“…. we are not persuaded that parties can be confident that the current law would

allow for a witness viewing the signing on a screen or through an electronic signature

platform, without being physically present. This conclusion is based on the restrictive

wording of the statutory provisions and the serious policy questions underlying any

extension to accommodate technological developments.

Our 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.”

Proving disputed electronic signatures in court

 The Law Society paper also contains an interesting section on a practical issue which often concerns financiers, namely the extent to which they may be at a disadvantage in proving disputed electronic signatures as opposed to the usual wet ink signature of a document. In this respect the position is somewhat reassuring:

 “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 (e.g. 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.

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 their email account or computer;

(ii) the location in which it was accessed;

(iii) that they 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 they applied their 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”.

 

Contact our Invoice Finance team.