With the ongoing COVID-19 crisis and the Government imposed social distancing restrictions, challenges have arisen around the valid execution and witnessing of legal documents.
The Law Institute of Victoria has provided guidance on what constitutes a legally enforceable signature, the witnessing of a signature and the attesting of documents. The key takeaways are as follows:
(a) online platforms such as Skype, facetime, zoom, cloud-based programs (such as DocuSign) or most other software do not meet the requirements for witnessing or attesting a document; and
(b) the chosen method of signing and witnessing must meet the minimum requirements required by the relevant legislation. In the context of electronic signing, depending on the chosen signature form, there may be a higher risk that those requirements will not be met as the witness needs:
(i) to be physically present at the time the document is signed by the signatory;
(ii) to sign (and know that he or she is signing) the same document, and not a separate copy of it; and
(iii) to sign at the time the document is signed by the signatory.
Witnessing a document that is not signed physically in person and relying on online software to witness that signing could expose the witness to various risks and potential claims, such as the document may not have the intended legal effect (if any) or an allegation of misleading and dishonest conduct.
With the situation surrounding COVID-19 constantly changing, alternative arrangements to witnessing documents can be arranged, which may include signing in an open space or using a drive through model that is being utilised in other industries.
It is also likely that legislation will be proposed shortly in Victoria which allows for the signing and witnessing of documents in the COVID-19 environment. In this regard, a COVID Legislation Amendment (Emergency Measures) Act 2020 has been passed in NSW which alters arrangements for the signature and witness of documents under emergency regulation. The LIV expects a similar Act to be proposed in Victoria. If approved, this will enable the making of regulations that may override the provisions of existing Acts to prescribe altered arrangements for the signature and witnessing of documents.
Further, the County Court of Victoria has recently announced that it will accept the filing of an affidavit which has not been sworn or affirmed, provided that a sworn or affirmed version is filed as soon as practicable. The affidavit must still be signed by the deponent and include a paragraph in the body of the affidavit stating that it cannot be sworn or affirmed at this stage due to measures to minimise the spread of COVID-19.
Should you wish to further discuss how documents can be witnessed and signed during the COVID-19 crisis, please don’t hesitate to contact David Woodford or Alfonso Grillo of our office on 03 8621 8888 or reach them by email at dwoodford@grillohiggins.com.au or agrillo@grillohiggins.com.au, respectively.
UPDATE 16/04/2020: Since the above article was published, the Law Institute of Victoria (LIV) released further guidance on signing and witnessing documents electronically amid the COVID-19 crisis.
In essence, the update release re-affirms the LIV’s earlier guidance while providing additional background information (including court decisions) that supports the position that companies can execute contracts electronically. Additionally, where a contract is in the form of a deed, there have been suggestions that electronic signing is not impermissible but such signing may be invalid where there is a split execution process (e.g. where two directors apply their digital signature on an identical, but separate deed).
The LIV is conscious of the continuing uncertainty regarding electronic execution by companies and sets out proposed urgent reforms to resolve these issues, including amending legislation to clarify the ability of a company’s officers to validly sign electronic documents.
The LIV has not changed its position in relation to the witnessing of documents.
The new guidance also covers signing and witnessing wills, powers of attorney, court documents and verification of identity. The full guidance can be found at: https://www.liv.asn.au/PDF/Professional-Practice/COVID19/20200409_LIV-COVID-19_Guidance-on-Witness-Docu-(2).aspx
Alfonso Grillo
Partner