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Classification of Law

Common Law

Common law systems originated in the Middle Ages in England, and while dependent on a system of written laws, place greater emphasis on legal precedent and court decisions to interpret how a law should be enforced. Common law countries place greater importance on evidence and the history of similar situations, based on the principle that facts and interpretation should be treated consistently over time. Common Law countries cover more than 30% of the world, including most of North America, the U.K., parts of Africa, Southeast Asia and most Commonwealth countries.

eSignature Legality Summary

Under English law, a written signature is not necessarily required for a valid contract - contracts are generally valid if legally competent parties reach an agreement, whether they agree verbally, electronically or in a physical paper document. Case law, including the decision of the Court of Appeal in Golden Ocean Group v Salgaocar Mining Industries, specifically confirms that contracts cannot be denied enforceability merely because they are concluded electronically.

However, to prove a valid contract, parties may need to present evidence in court. Digital transaction management solutions, such as electronic signatures, are a way to provide electronic records that are admissible in evidence under s7(1) Electronic Communications Act 2000 ("ECA 2000") to support the existence, authenticity and valid acceptance of a contract. One type of electronic signature, a Qualified Electronic Signature, provides additional substantiation in court by providing the digital equivalent of a handwritten signature.

Under English law, some documents must be executed as a deed. Electronic signatures are a valid method of executing such deeds under English common law. Two important exceptions to this general rule are deeds which are registrable with the UK Land Registry, and wills.

Deeds which are registrable with the UK Land Registry are subject to a separate statutory regime under Section 91 of the UK Land Registration Act 2002 and the Land Registration Rules 2003. The statutory scheme provides that electronic deeds will be accepted for registration at the UK Land Registry if they are the subject of a notice issued by the UK Land Registry under rule 54C of the Land Registration Rules 2003. Currently, the only deed that is the subject to such a notice is a "digital mortgage", which must be signed using the Land Registry's purpose-built "Sign your mortgage deed" service.

Wills are a special form of deed where the current law is incolcusive as to whether they may be electronically executed or not. Current case law does not conclusively resolve the issue: a recent decision (Lim v Thompson [2009] EWHC 3341 (Ch)), where a photocopy of the will maker's signature was held not to be a valid signature, suggests a reluctance by the court to accept anything other than an original handwritten signature.

In many cases, the execution of a deed must be physically witnessed and the witness must attest to the deed. A witness to an electronically executed document must therefore be in the same room as the signatory when they apply their electronic signature and can electronically attest to that deed.

In addition, Regulation (EU) No 910/2014 on electronic identification and trust services for electronic transactions in the internal market (the “eIDAS Regulation”) came into force on 1 July 2016. The eIDAS Regulation repealed and replaced the e-Signatures Directive (1999/93/EC) and is directly applicable in the 28 member countries of the European Union.

The eIDAS Regulation is technology-neutral and defines three types of electronic signature (SES, AES1 and QES2). Article 25(1) 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 does not meet the requirements of a QES. Articles 25(2) and (3) give a QES the same legal effect as a handwritten signature and ensure that a QES recognized in one Member State of the EU is also recognized in other Member States. Finally, Recital 49 allows national law to set requirements regarding which type of electronic signature may be required in which circumstances.

In some cases, documents must be registered with an authority to have legal effect. There is nothing to prevent an individual authority from setting its own specific additional requirements for documents to be registered with it. Where a document needs to be registered with an authority to have legal effect, even where it has been executed lawfully using an electronic signature, if that authority only accepts “wet ink” signatures, the parties will not be able to execute documents electronically, regardless of the legal

position. Therefore, a party should be familiar with the industry practice of a specific individual authority to ensure that such authority will accept a document with an electronic signature.

Use Cases for Standard Electronic Signature (SES)

Use cases where an SES is typically appropriate include:

  • certain HR documents, such as employment contracts, benefits paperwork and other new employee onboarding processes
  • commercial agreements between corporate entities, including NDAs, procurement documents, sales agreements
  • consumer agreements, including new retail account opening documents
  • certain real estate documents, including documents usually signed under hand (e.g., not as a deed) and where such documents are not to be lodged at the Land Registry and are not registrable
  • certain securitization documents, such as a guarantee

Use Cases That Are Not Typically Appropriate for Electronic Signatures or Digital Transaction Management

Use cases that are specifically barred from digital or electronic processes or that include explicit requirements, such as handwritten (e.g., wet ink) signatures or formal notarial process that are not usually compatible with electronic signatures or digital transaction management.

  • Handwritten – real property documents submitted for registration with Land Registry and Land Charges Registry, including deed of transfer, certain leases, grants or transfers of a charge

  • Handwritten – documents which are registrable or need to be filed with an authority which requires wet-ink signature such as documents required to be sent to HM Revenue and Customs, where stamp duty is payable

  • Handwritten – various personal documents such as wills and lasting powers of attorney

[1] An AES is an “advanced electronic signature”, a type of electronic signature that meets the following requirements: (a) it is uniquely linked to the signatory; (b) it is capable of identifying the signatory; (c) it is created using means that are under the signatory’s sole control; and (d) it is linked to other electronic data in such a way that any alteration to the said data can be detected.

[2] A QES is a specific digital signature implementation that has met the particular specifications of a government, including using a secure signature creation device, and been certified as ‘qualified’ by either that government or a party contracted by that government.

Local Technology Standards

As part of the European Union, the UK defines different classes of electronic signatures, as specified in the eIDAS Regulation, including qualified electronic signatures in the local Electronic Signature Regulations ("ECA 2000"). A Qualified Electronic Signature is automatically granted the equivalent legal effect of a handwritten signature. Where a Qualified Electronic Seal is used (by legal persons such as corporate entities) the integrity of the data and correctness of the origin of the data shall be presumed. The enforceability or validity of a document signed by electronic signature, regardless of technology or certification, depend on the evidence associated with a particular signature (or seal).

eSignatures After Brexit

Overall, Brexit will have no effect on the e-signature-friendly English law of electronic signatures. The UK has passed the European Union (Withdrawal) Act 2018 to provide legal certainty and continuity of EU laws under UK laws, including eIDAS, which governs electronic transactions in the European Single Market and electronic signatures.

The status of electronic signatures will remain the same under the Withdrawal Act as it did under eIDAS and it is expected that the eIDAS Regulation will be carried forward into UK law given that the regulation aims to create easier, safer and quicker ways for parties to carry out transactions on digital platforms. The government has also said that qualified signatures supported by an EU trust service provider will continue to be recognised under UK law. 

DISCLAIMER: The information on this site is for general information purposes only and is not intended to serve as legal advice. Laws governing electronic signature may change quickly, so DocuSign cannot guarantee that all the information on this site is current or correct. Should you have specific legal questions about any of the information on this site, you should consult with a licensed attorney in your area.

Last updated: November 01, 2019

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