WFH or not, getting contracts signed remains crucial to many organisations – this note provides practical guidance to signing Scots law documents remotely and electronically.
Execution of agreements in counterpart
Execution in counterpart takes place where separate copies of the same agreement are signed by parties in different locations and copies of signed agreements are then exchanged (whether or not electronically). The signature can either be a “wet ink signature” (where an agreement is printed, signed and an image of the signed copy circulated with the other parties) or, in some cases, an electronic signature (read on for more on these).
Many agreements include a counterparty signing clause - this can set out specific arrangements agreed by the parties regarding practicalities of signing. However it is possible to use this method of signing even if it is not specifically set out in the agreement.
Whether an e-signature can be used, and the type of e-signature required, depends on the type of document to be signed:
- For many agreements, a simple electronic signature is a valid form of execution. A simple electronic signature can take many forms such as typing the signature and other relevant information in the signing block or copy/pasting an image of the signature into the document or ticking an “I ACCEPT” button on screen.
- It is not possible to use e-signatures for certain documents though including wills and documents to be registered for example in the Books of Council and Session or at Companies House.
- An “advanced electronic signature” (AES) is required for certain documents. The types of documents are specifically set out in the Requirements of Writing (Scotland) Act 1995 and the list includes some agreements relevant to land transactions such as standard securities and dispositions. The AES is intended to give increased assurance that the document has been signed by the correct person. The AES can be purchased as a service through various e-signing services, though it should be noted that not all platforms meet the standards required for the e-signature to be considered an AES – look for guarantees in this respect.
Evidentiary status of e-signatures
If a signature fulfils certain formalities, that signature will benefit from legal presumptions which will apply unless the contrary can be proven. One of these is that the document is presumed to have been signed by the relevant party.
This presumption would not apply to a simple e-signature, such as those discussed above. However that is only likely to become an issue where a party disputes the authenticity of its signature. If this did happen, the party seeking to enforce the contract would need to provide evidence that the signature is authentic. Whether such evidence is easy to come by will depend on the surrounding circumstances, such as whether the parties proceeded to perform the agreement.
For an electronic signature to benefit from this presumption, it would have to be a so-called qualified electronic signature (QES). This standard can be met, for example, by certain Scottish solicitors who can sign documents on behalf of clients using their Law Society Smartcard. However, apart from that, QES is not currently widely used or available in Scotland.
In case of “wet ink” counterpart execution, if no witness is available, it is possible to leave that section blank in the signing block. The signature will still be valid but will not benefit from the legal presumptions discussed above.
Having someone “witness” an e-signature, for example, by uploading a scan of their signature to the witness signing section, may have some evidentiary value. However, for an electronic signature to be self-proving it must be created by using a QES.
There are various platforms that enable the electronic signing of documents such as DocuSign and Adobe Sign. It should be considered in each case whether the signature generated by the platform (i.e. simple, AES or QES) is appropriate to the document being signed. The standard functionality on many e-signing platforms does not satisfy the requirements of an advanced electronic signature let alone a qualified electronic signature.
However in some cases it is worth using these platforms due to added evidentiary value (such as authentication steps implemented and metadata collected by the platform) or for organisational reasons.
Get in Touch
If you have any questions in relation to applying the use of electronic signatures to your daily workload or how MacRoberts can assist you, please get in touch with us.