Following our article on e-signatures earlier in the year, we have been reflecting on the challenges for executing agreements in a “socially distanced” world. One such challenge relates to the practicalities of getting signatures witnessed. In this article we review who makes a suitable witness for signatures and how to navigate the witnessing requirements under English law.
When is a witness required?
A witness to the signature of an agreement will not normally be required if the agreement is a simple contract.
In relation to the execution of deeds[1], however, there may be a requirement for the signatures of the parties to be witnessed in order for the deed to be validly executed. This depends on the nature of the contracting party and the method used to sign the deed. For example, where the signatory to a deed is an individual acting in their own capacity, their signature must be witnessed.[2] Similarly, a company that wishes to execute a deed by only one director, or an LLP that wishes to execute a deed by only one member, will also need this signature to be witnessed.[3]
Why are witnesses required?
The witness’s role is primarily to guard against forgery or duress. In the event of a dispute, a witness may be required to provide unbiased evidence about the circumstances of the signing.
Who can witness?
It was established by case law over 150 years ago that a party to a deed cannot also act as a witness to the execution of such deed.[4] Whilst there is no statutory requirement for a witness to be “independent” (i.e. unconnected to the parties or subject matter of the deed), given that a witness may be called upon to give unbiased evidence about the signing, it is considered best practice for a witness to be independent and, ideally, not a spouse, co-habitee or close family member of the individual signing the deed. There is no specific bar preventing minors (under 18s) from acting as witnesses, although it would be safer to use an adult witness in order to avoid any subsequent challenge as to the witness’ reliability or mental capacity based on their age.
Consequently, the ideal witness under English law is a person aged 18 or over, who is not a party to the deed, has no commercial or financial interest in the subject matter of the deed and no close personal relationship with the person whose signature they are witnessing.
How do you witness a signature?
There is no clearly prescribed method for attesting signatures set out by statute, but the generally accepted approach is that the witness: (1) watches the signatory sign; and (2) “attests” to the signature by signing a statement in the deed (commonly referred to as an attestation clause) confirming that the deed was signed in their presence. The witness is not required to vouch for the identity of the signatory or read the document.
It is best practice for the witness to print their name and provide their address and occupation in the attestation clause so that they can easily be contacted should they need to be called upon to help resolve any issues that arise in relation to the execution of the deed.
Does the witness need to be physically present?
It is a statutory requirement that the witness must be present when the executing party signs the deed. The Law Commission’s 2019 report on the electronic execution of documents confirms that this means physical presence:
“… 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.”
Therefore, it is not yet possible to witness a signature via a video call or other virtual methods. Whilst finding an impartial, non-co-habiting witness who can be physically present at the point of signature would not ordinarily present a significant obstacle for most people, social distancing measures and the current increase in non-office-based working certainly make it more challenging.
Where it is not possible to be in the physical presence of an independent witness, then a family member or cohabiting individual will suffice, providing the witness is not party to the documents or wider transaction.
Do you really need a witness?
For the reasons mentioned above, a witness will be a requirement when an individual is executing a deed, or a company or LLP is executing a deed via a single signatory.
However, given the practical difficulties of witnessing at the moment, a party may wish to consider whether a witness is really necessary. There are two main ways in which you may be able to avoid a requirement for a witness under English law:
Use a simple contract rather than a deed
Agreements are often drafted as deeds where the agreement includes a power of attorney (which, under English law, must be executed as a deed) or if the agreement has no consideration (e.g. no fees for services or no price for goods/assets being purchased).
One of the most common types of agreement we work with is an assignment of intellectual property rights (IP). An IP assignment may be drafted as a deed, but in many cases does not need to be. This may also be the case for other agreements you are reviewing. If a document has been prepared as a deed, you should consider whether it could be amended so that it can be executed as a simple contract (in which case no witnesses will be needed).
Execute the document with more signatories
The default rules for execution of deeds by companies and LLPs under English law provide multiple options for valid execution of documents. Whilst execution of an agreement by one director (or member) does require a witness, the company or LLP can avoid this by switching to the two-signatory option. To execute via two signatories requires a company to have either two directors or one director and a company secretary; and for an LLP to have two members.
Even though this means a greater number of signatories, this may still be preferable to each party needing to sign in the physical presence of a witness.
If you would like further advice on best practice and possible strategies for effective execution of agreements during Covid-19, please get in touch.
[1] Historically, deeds were used for many types of contract. However, over time their use has been limited with the result that they are now primarily used only for agreements in which there is no consideration or where required by statute.
[2] Section 1(3), LP(MP)A 1989.
[3] Section 44(2)(b) of the CA 2006.
[4] Freshfield v Reed (1842) 9 M&W 404 and Seal v Claridge (1881) 7 QBD 516.
This information provides a summary of the subject matter only. It should not be acted on without first seeking professional advice.
