A legislative comparison of electronic signing regimes in Australia
Background
In 2020, temporary changes to the Corporations Act 2001 (Cth) (the Act) were made as a COVID safety measure, which allowed for the electronic execution of documents. This article provides insights on how the changes have now been made permanent in the respective State and Territories.
Following on from the Corporations Amendment (Meetings and Documents) Act 2022 (Cth), companies are now able to execute contracts, deeds, and other documents electronically. This has prompted the States and Territories to follow suit, by amending State and Territory legislation to enact similar provisions that replicate the amendments made to the Corporations Act 2001 (Cth).
The amendments to both Commonwealth and State laws have sought to strike a balance between providing sufficient security in the identification of signatories as well as affirming the intention to create legal relations and facilitating more efficient and cost-effective practices of conducting business through broadening the means of executing documents in a post-pandemic era. One of the main benefits of electronic conveyancing is the speed and convenience it offers, allowing transactions to be completed without the need of paper-based documents reducing the risk of error and delays, and saving resources for all parties involved.
Commonwealth Legislation
The Corporations (Coronavirus Economic Response Determination (No. 1) 2020 was the Commonwealth’s first amendment to electronic execution law. This modified the operation of provisions of the Corporations Act 2001 (Cth) and the Corporations Regulations 2001 (Cth), to allow for meetings to be held online, and documents to be executed electronically.
To solidify the permanency of these laws, the Corporations Amendment (Meetings and Documents) Act 2022 (Cth)was introduced, not only affirming the electronic execution of documents, but more specifically establishing that:
- documents (including deeds) may be signed electronically by any method that identifies both the identity and intentions of the party, in accordance with sections 110A(2) and 110A(3) of the Act;
- an agent can execute a document (including a deed) on behalf of a company electronically, in accordance with section 126;
- a sole director proprietary company that does not have a company secretary can now also execute a document (including a deed) in accordance with section 127(1) or section 127(2);
- for a company executing a document under seal under section 127(2) of the Act, the witness can observe the witnessing of the seal by electronic means; and
- for the execution of a deed, delivery is not necessary if a company executes a deed in accordance with section 127(1) or section 127(2).
New South Wales
New South Wales was one of the first of the States to implement provisions for electronic execution in April 2020. Throughout 2020 and 2021, New South Wales made numerous changes, and introduced new laws expanding the types of documents that can be executed electronically.
These changes namely allowed for:
- the remote witnessing of signatures through an audio-visual link;
- the electronic signature of a client authorisation;
- paper land dealings to be signed and witnessed electronically; and
- owners’ corporations and community associations to vote and execute documents electronically, without having an affixed seal.
While most of these amendments did not have an expiration date, all have since become permanent. The Electronic Transactions Act 2000 (NSW) was amended through the Electronic Transactions Amendment (Remote Witnessing) Act 2021 (NSW) establishing permanency for the electronic execution, remote witnessing, and attestation of documents. These amendments further allowed for a signatory or a witness of a signatory to be located outside of the jurisdiction for any document being executed in accordance with the of Laws of New South Wales.
Victoria
Alongside New South Wales, Victoria implemented provisions for electronic execution in April 2020. The COVID-19 Omnibus (Emergency Measures) (Electronic Signing and Witnessing) Regulations 2020 (Vic) allowed for deeds to be electronically executed and permitted the remote witnessing of transactions and other documents that had previously required in-person witnessing under Victorian law. This was repealed and replaced with the Justice Legislation Amendment (System Enhancements and Other Matters) Act 2021 (Vic) which amended the Electronic Transactions Act 2000 (Vic), providing that:
- electronic signatures are sufficient and may be witnessed through an audio-visual link;
- a deed may be created in electronic form and may be signed, sealed, and delivered by electronic communication; and
- a mortgage may be in electronic form.
The Justice Legislation Amendment (System Enhancements and Other Matters) Act 2021 (Vic) further amended the execution and witnessing requirements under the Powers of Attorney Act 2014 (Vic). However, electronic execution must adhere to ‘remote execution procedure’ as set out in sections 5A to 5D.
Queensland
Following New South Wales and Victoria, Queensland made amendments to various legislation including the Property Law Act 1974 (Qld), Oaths Act 1867 (Qld) and the Power of Attorney Act 1998 (Qld) now allow individuals to sign documents electronically including deeds, oaths, affidavits, general powers of attorneys and declarations.
At the end of 2021, the Justice and Other Legislation Amendment Act 2021 (Qld) was introduced, in an attempt to make some of these temporary measures permanent. However, while the Act was assented to on 24 November 2021, the relevant provisions in the Act were only to take effect on a day to be fixed by proclamation.
Now, pursuant to Proclamation No 2 of the Justice and Other Legislation Amendment Act 2021 which was signed on 17 March 2022, the relevant provisions (commenced on 30 April 2022), which permit:
- affidavits and statutory declarations being in electronic form, electronically signed and witnessed through an audio-visual link;
- general powers of attorney (POA) for businesses being in electronic form, signed electronically without a witness and made in counterparts/by split execution;
- corporations executing a POA without using a common seal;
- deeds being made or signed electronically, without a witness and without needing to be sealed; and
- mortgages being in electronic form and signed electronically by the mortgagor or the mortgagee, without the need for any witnesses.
Australian Capital Territory (ACT)
As amended in 2012 by the Electronic Transactions Amendment Act 2012 (ACT), the Electronic Transactions Act 2001 (ACT) had already facilitated the electronic execution for certain documents (provided that execution is conducted in accordance with section 9).
In 2020, the ACT introduced the COVID-19 Emergency Response Act 2020 (ACT), as a temporary measure, permitting for certain documents to be witnessed by an audio-visual link. The documents that are generally included under section 4 of COVID-19 Emergency Response Act 2020 (ACT) are POAs and enduring Powers of Attorney, health directions, wills, and affidavits.
For remote witnessing to be considered valid in the ACT, the legislative amendments required the witness to:
- observe the signatory sign the document in ‘real time’;
- provide confirmation through signing the document or a copy of the document;
- be reasonably satisfied that the document signed by the signatory is the same document (or a copy of the same document) as signed by the witness in confirmation; and
- endorse the document by providing a statement that specifies the method used to witness the document, and that the signature was witnessed in accordance with section 4 of the COVID-19 Emergency Response Act 2020 (ACT).
However, this legislation expired on 31 December 2022, following the end of the penultimate COVID-19 emergency period, and the ACT is still yet to legislate any provisions for remote witnessing post-COVID.
Western Australia
Western Australia introduced the COVID-19 Response and Economic Recovery Omnibus Act 2020 (WA) in its response to the COVID-19 pandemic. Under this act, witnesses can witness signatories signing certain documents, such as affidavits and statutory declarations (under the Oaths, Affidavits and Statutory Declarations Act 2005 (WA)), remotely through an audio-visual link, using technology that facilitates continuous and simultaneous audio and visual communication (e.g., FaceTime, Zoom or Microsoft Teams).
Division 4 of Part 2 of the Act was extended until 31 December 2022, pursuant to the COVID-19 Response and Economic Recovery Omnibus Act 2020 Postponement Proclamation 2021 (WA). However, in 2023, Western Australia has made no advancements towards instituting legislation to provide avenues for permanent electronic witnessing.
South Australia
In 2020, South Australia introduced temporary measures, extending the list of persons who could witness statutory declarations, as well as suspending the requirement for land registry instruments to be witnessed.
From 20 April 2020, pursuant to the COVID-19 Emergency Response (Section 16) Regulations 2020 (SA)(Regulations), the list of persons who could witness statutory declarations in South Australia under the Oaths Act 1936 (SA) was extended to include all the persons listed in Schedule 1 of the Regulations.
The South Australian Government has made regulations under the Oaths Act 1936 (SA) as amended by the Oaths (Miscellaneous) Amendment Act 2021, to allow, from 14 October 2021, affidavits to be witnessed remotely over audio-visual link. Also commencing on 20 April 2020, the COVID-19 Emergency Response (Section 17) Regulations 2020 (SA) provided that section 17 of the COVID-19 Emergency Response Act 2020 does not apply when a person is required to be physically present to witness the signing, execution, certification or stamping of a document or to take any oath, affirmation or declaration in relation to a document.
Northern Territory
The Northern Territory introduced the Land Legislation Amendment Bill 2022 in November 2022, and it was successfully passed by the Northern Territory Government in February of 2023. The Land Legislation Amendment Bill 2023 purpose was to has amended the Electronic Conveyancing Act 2013. The key provisions to provide that documents may take the form of electronic conveyancing documents, references to signing or executing of documents are references to documents that are electronically signed, requirements for clients authorisations for electronic conveyancing and requirements for verification of identity.
Tasmania
The Tasmanian government enacted the COVID-19 Disease Emergency (Miscellaneous Provisions) Act 2020 (Tas) as its response to COVID-19. The Act was assented to on 27 March 2020 and consolidated on 3 September 2022. The COVID-19 Disease Emergency Notice 18/2020, made under section 17 of the COVID-19 Disease Emergency (Miscellaneous Provisions) Act 2020 further allowed for the remote witnessing of certain types of documents, provided that:
- the intended recipient of the document must agree to the method of signature, by way of supplying the producer of the document with their email address or telephone number for the purpose of receiving the document as being sent through email or facsimile;
- the witness must observe the signatory sign the document through an audio-visual link in ‘real time’; and
- the witness must be satisfied the document being signed by the signatory is the same document, as the document the witness is attesting to observing the signatory sign.
Subsequently, Disease Emergency Notice 2/2021 and Notice 12/2021 have been made to further allow for documents to be served, signed and witnessed through electronic means as authorised under section 17 of COVID-19 Disease Emergency (Miscellaneous Provisions) Act 2020 (Tas), provided they are signed in accordance with section 7 of the Electronic Transactions Act 2000 (Tas). Nevertheless, wet-signatures and in person witnessing are still required for certain categories of documents, including the valid execution of deeds.
Final Thoughts
The amendments made to the Commonwealth law, as well as the amendments that many of the States and Territories have made to their own legislation has actively assisted in enhancing the practical aspects of executing documents in Australia. These laws improve both the cost and time efficiency of signing and witnessing documents, by incorporating the technology that has been both developed and relied upon during the COVID-19 pandemic. This has led to efficiencies in practice in completing transactions, which has had positive impacts in the time it now takes and the cost of completing transactions.