HomeInsightsCovid-19 – the logistics of lockdown execution

Covid-19 lockdown measures mean that many people have been forced to work from home, at relatively short notice and with little time for adequate planning. Despite this, contractual business activity, which includes various formalities such as execution and completion of documents, continues unchanged.

Most people don’t have fully functioning home offices and it isn’t as straightforward as before to access postal services. So, how can we safely and legally execute documents during the current lockdown? The answer to this will largely depend on what type of document is being executed.

Simple Contracts

So long as there is no requirement for a ‘wet-ink’ signature by, for example, any regulatory body, statute or registry, then it is usually adequate for a simple contract to be signed wholly electronically. However, please note this isn’t a hard and fast rule as there may be other considerations, such as the acceptance of e-signatures in other jurisdictions, statutory or common law requirements and/or constitutional restrictions, which could impact validity. Each scenario should be assessed on a case by case basis.

Where e-signatures are valid, this can be by way of an encrypted electronic signatory platform, such as DocuSign, or by various other methods, such as insertion of a signature image, by signing with a stylus, or by simply typing in the signature.

If wet-ink signatures are required, then the ‘Mercury Rules’ can be applied. This is where the final version of a document is circulated to the authorised signatory who will then print, sign and scan back a copy of the signature page with their authority for that signature to be appended to the final form contract. The hard copy usually then follows in due course. In the current climate, this will obviously only be an applicable method where the signatory has access to a printer and a scanner. If the absence of a scanner is an issue, we see no problem with photographic evidence (taken by a smart device) of the signature page instead.

If a printer isn’t available, then it is worth checking if your firm has a ‘skeleton’ staff on hand to print and post a hard copy of the document instead. The Mercury Rules can then otherwise apply.

Deeds

While deeds can be signed electronically, the usual formalities must still be followed.

If it is an individual signing, or one director of a company, then that signature must also be witnessed. If there is no requirement for a wet-ink signature, then it is perfectly adequate for electronic signatures to be used so long as the witness is physically present when that electronic signature is applied and that they are then able to apply their own signature, either electronically or otherwise. Social distancing will obviously make the physical presence of a witness more difficult than normal, however, so long as there is no requirement for the witness to be independent (e.g. for a will), then it is fine for an adult family member or cohabitee to act as witness. At this moment in time, witnessing by virtual means (e.g. by video link) is not valid.

In the case of companies, if they are not signing by one director and a witness and are instead executing by way of two directors (or a director and the company secretary) then this can also be done electronically (again, so long as registration, regulation and/or statute allow).

Where wet-ink signatures are required (e.g. for registration at the Land Registry, or similar), so long as a witness can be physically present to the signature, to get around the logistical issues of having hard copy signatures at completion, the Mercury Rules can apply as outlined above. The wet-ink versions can then follow as soon as practicable after completion, and within any registration timeframe.

The information in this article is not intended as advice but as a general overview. Please feel free to get in touch should you need tailored advice for any specific situation.