Skip to main content

Insight article

January 30, 2020

Don’t put your footer in it when it comes to contracts

Companies are being urged to review their electronic procedures following a court ruling that an automatic email signature could suffice to conclude a binding contract.

Although legislation to align e-signature standards across the EU was introduced by the Electronic Identification Regulation in 2016 and the Electronic Communications Act 2000, there remains confusion.

Head of Corporate and Commercial Victoria Holland explains:

“As a general rule, no contract made under English law needs to be signed, or even be in writing, unless the contract is a guarantee for payment by someone else, or it relates to land or is made by deed. People often think they must sign on the dotted line to seal a deal but in many situations all that is needed is a clear agreement and intention.

With the increased use of electronic communications in contractual negotiations, it is important for companies to understand all the different circumstances in which an exchange may form a binding contract.”

Last year, the Law Commission published a report on the electronic execution of documents to tackle this uncertainty. The Law Commission confirmed that e-signatures could be used to execute documents as an alternative to wet ink signatures in most circumstances and relied upon as evidence.

The recent case of Neocleous v Rees signals a further shift in the approach to e-signatures with implications for anyone involved in electronic, contractual negotiations.

The court ruled that including the writer’s name in the automatic email footer amounted to an electronic signature and was sufficient to conclude a binding contract for transferring an interest in land.

The judge said that the email sender knew that his name would be added as a footer and, although it was an automatic process, it represented a conscious decision, combined with the name and contact details being in the conventional style of a signature, at the end of the document.

Head of Dispute Resolution, M. Qaiser Khanzada, explains:

“This case related to a fairly rare type of property transaction but has an important message for day-to-day communications. If companies are to avoid inadvertently entering into a contract with suppliers or customers, they should incorporate a clear disclaimer designed to prevent the accidental formation of a contract and not simply rely on an automatic proviso to their e-signatures.”

It follows that, as well as email footers, other methods that could create a valid signature include:

  • secure passwords
  • tick-boxes
  • PIN numbers

Ink signatures are still required for the execution of deeds, as the signature must be witnessed, and the law does not presently allow for remote witnessing. However, live video witnessing is under discussion.

For contract enquiries, speak to Victoria Holland today. For contract disputes, call M. Qaiser Khanzada today.

Note: This is not legal advice; it provides information of general interest about current legal issues.

Stay in touch

Subscribe to our newsletter

Stay in touch

By completing your details and submitting this form you confirm you are happy for us to send you marketing communications and that you agree to our Website Privacy Policy and Legal Notice and to us using Mailchimp to process your data.


Sending

News/Insight

  • Pay transparency in recruitment: Is your business ready to disclose salaries?
    Employers may eventually have to provide salary information much earlier in the recruitment process under proposals being considered by the Government.


    Read more
  • Pension inheritance tax changes will increase executors’ responsibilities from April 2027
    From 6 April 2027, most unused pension funds and pension death benefits will be included within the scope of Inheritance Tax. We explain what the changes mean for executors, why estate administration may become more complex and how careful planning c


    Read more
  • What is company record keeping and why is it important?
    Accurate company record keeping is essential for meeting legal obligations, protecting directors and shareholders, supporting business decisions and reducing risk. This guide explains which records companies should maintain, why they matter and the c


    Read more
  • Buying a commercial unit: what you need to know
    Buying a commercial unit can be a valuable step for your business, but it comes with legal, tax, planning and property risks. Brinda Granthrai explains what buyers should consider before committing.


    Read more
  • Pension and inheritance tax changes from April 2027: why now is the time to review your will and estate plan
    From 6 April 2027, most unused pension funds and pension death benefits are expected to be included in a person’s estate for inheritance tax purposes. This article explains what the changes could mean for families, pension nominations, wills, chari


    Read more

What they say...

  • Client, July 2026
    Constructive and empathetic “I contacted Pippa Marshall at RIAA Barker Gillette through a recommendation regarding a family law matter. Pippa was always clear, efficient, empathetic and helpful, offering constructive insights on my situation. I

  • Dino, July 2026
    A lucky professional meeting! “We had an excellent professional experience to recommend to all those who need legal help in the UK.”

  • Client, July 2026
    10-star service from Patrice Lawrence “I cannot encompass in words how brilliant a service and support I have received since working with Patrice. Effective efficiency, exceptional excellence. All this and more. I am grateful that Patrice manag

  • Dino, July 2026
    Unexpected and very valid professional experience “Law firm to be recommended also to non-residents in the UK”

  • Client, July 2026
    Seamless experience “My recent experience with RIAA Barker Gillette was exceptional. They provided considered care, attention to detail, and I felt supported every step of the journey. This was my first time working with a solicitor, and I was

Read more
Send this to a friend