COVID-19: Execution of Documents Remotely

COVID-19 Business, but not as we knew it

Remote Execution of Documents Virtual Closings

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COVID-19 Business, but not as we knew it:

Remote Execution of Documents Virtual Closings

The government’s restrictions imposed in response to the Covid-19 pandemic have raised a number of practical difficulties for parties when signing documents. In the first part of this article we examined the options available when signing contracts remotely. In this second part we consider a recommended approach to remote or virtual signings.

Johnathan Rees Partner johnathan.rees@laytons.com +44 (0)20 7842 8009

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COVID-19 | Remote Execution of Documents: Virtual Closings

Background

Deeds

The practice of "virtual” signings and closings is well established where documents are executed "remotely" and transactions completed without the parties meeting in one place. The majority of corporate transactions take place as remote completions with documentation being emailed, printed, signed and scanned remotely instead of being signed by the parties physically present in the same room.

A recommended approach for the signing of a deed is as

Guidance notes on the practice and protocol have been

follows: A complete final version of the document in PDF or word form (we recommend PDF) together with a separate PDF of the signature page should be sent by email to the relevant signatories with a together with a request that the signatories: • print the document or just the signature page (helpful in the case of particularly lengthy documents) • sign the signature page complying with necessary witnessing formalities (see May newsletter).

published most recently by The Law Society to facilitate such arrangements.

The signatories should email back both: • the complete final version of the document; and

Options The Law Society guidance outlines three options available to parties and advisers when looking to sign documents and complete transactions remotely. The choice of option will depend on the type of document in question as different statutory and legal arrangements apply concerning the formality of their creation. The options are as follows: • Return by e-mail the entire document and the signed signature page • Return by e-mail only the signed signature page • Create a pre-signed signature page in advance of finalising the document The approach to be taken will depend on the nature of the documents being signed and whether they are simple contracts or deeds.

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• the validly executed signature page • That email and its attachments will constitute the original duly executed document.

Particular care must be taken when signing deeds, as specific rules apply concerning their execution, witnessing and delivery (evidencing an intention to be bound by the document)(see May newsletter article). It should also be remembered that original “wet ink” signature versions of documents may be required for post-completion registrations at the Land Registry or Companies Registry (e.g. in the case of land transfers, leases or charges). This may require solicitors to provide undertakings to deliver wet ink originals in due course. Under current pandemic government restrictions that may be problematic for a law firm and it follows that virtual completions may not be possible for all transactions.

COVID-19 | Remote Execution of Documents: Virtual Closings

Simple Contracts

• Electronic signatures:

These were the subject of our previous article (see May

The procedure recommended for deeds described above is

newsletter article) and are a valid means of executing

the preferable option but it would also be acceptable to email

documents (including deeds). Electronic signatures

to the signatories a PDF or word version of the final document

should not however be used for deeds dealing with

and for the signatory to email back the signed signature page

dispositions of real estate.

only.

The signatory’s email should contain their express authority for the recipient to attach the signature page to the final

• Mobile devices:

A signatory can use a smartphones or other mobile device to sign documents.

contract.

• Cross border transactions:

"

If the transaction involves parties from other

Ensure all parties expressly consent to the signing arrangements

jurisdictions then the documents may need to be notarized and apostilled. A notary authenticates the execution of certain documents and an apostille is a certificate certifying the genuineness of the notary's signature. Notarisation can require physical attendance by signatories and the parties should confirm the

Practical Considerations

signing proposals with the notary and local counsel beforehand.

• Co-ordination:

Signatories should: • be given sufficient notice of the signing arrangements and confirm that they are satisfied with the approach • be clear on how electronic devices may be used (e.g. what applications must be downloaded) • check permissions under their internal policies and constitutional documents on the use of those applications and the proposed signing arrangements (particularly where the transaction

Closing thoughts Provided that signatories have access to the relevant devices and equipment (e.g. printer and a scanner), parties should be able to continue to follow the existing transaction protocol for the virtual signings. The government’s recent qualified relaxation on the witnessing of signatures has been a helpful addition to the protocol.

involves parties in another jurisdiction).

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COVID-19 | Remote Execution of Documents: Virtual Closings

Expertise

Corporate & Commercial We provide a complete range of corporate and commercial advice and support for clients who extend from start-ups, individual entrepreneurs and family offices to multinational corporations.

We advise on every facet of our client’s corporate legal needs through the complete life-cycle of an enterprise, from its inception, through its growth and expansion to, perhaps, its sale or flotation on a public market. Our teams focus on acquiring a deep understanding of the particular needs and objectives of our clients to deliver advice and outcomes that are tailored to those needs and objectives and which meet them swiftly and cost-effectively. The approach to technical problems is informed, insightful and proportionate, and we take pride in viewing problems from a fresh perspective to provide innovative solutions.

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John Gavan

Esther Gunaratnam

Dimitri Iesini

Partner john.gavan@laytons.com +44 (0)20 7842 8000

Partner esther.gunaratnam@laytons.com +44 (0)20 7842 8000

Partner dimitri.iesini@laytons.com +44 (0)20 7842 8081

Robert MacGinn

Brian Miller

Daniel Oldfield

Partner robert.macginn@laytons.com +44 (0)20 7842 8000

Partner brian.miller@laytons.com +44 (0)20 7842 8000

Partner daniel.oldfield@laytons.com +44 (0)20 7842 8037

Daniele Penna

Johnathan Rees

Christopher Sherliker

Partner daniele.penna@laytons.com +44 (0)20 7842 8053

Partner johnathan.rees@laytons.com +44 (0)20 7842 8009

Partner christopher.sherliker@laytons.com +44 (0)20 7842 8015

Cameron Sunter

Liza Zucconi

Partner cameron.sunter@laytons.com +44 (0)20 7842 8036

Partner liza.zucconi@laytons.com +44 (0)20 7842 8092

2 More London Riverside, London SE1 2AP +44 (0)20 7842 8000 | london@laytons.com laytons.com

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