Electronic Signatures: A Sign of the Times

The COVID-19 pandemic brought us masks, vaccinations and a nationwide shortage of toilet paper but one unintended benefit of the pandemic has been the evolution of and vast acceptance of electronic signatures for company documents.

In February this year, the Federal Government passed the Corporations Amendment (Meetings and Documents) Bill 2021 (Cth) which made temporary rules to allow electronic signatures for particular company documents, permanent.

Company Officers can now sign documents electronically provided it identifies the person, is reliable and signals their intention to be bound. Moreover, documents can be signed electronically in counterpart which means parties don’t need to sign the same document electronically.

The legislation makes it clear that a company can electronically execute contracts as well as deeds in electronic form. This is further codified in NSW as Deeds can be electronically signed and attested under s38A of the Conveyancing Act (1919) NSW.  

Care does however need to be taken where deeds are signed in different jurisdictions.  Moreover, documents that require a witness i.e. are signed by an individual cannot be signed electronically.

Importantly these changes have paved the way for electronic platforms such as DocuSign to easily execute documents from a digital device, and removing the need to print, sign and post documents signed in ‘wet ink’. 

Whilst these changes allow documents to be signed electronically, we recommend ensuring that appropriate provisions are included in all agreements to ensure that parties signal their intention to sign and be bound electronically and in counterpart.