In brief terms, signing electronically is the process of adding data in electronic form and used by a signatory to sign a document. There are a number of different forms of electronic signatures widely available for use, and a range of providers or systems which offer ways and means of signing electronically.
Due to the nature of the documents and deeds processed by HM Land Registry, prior to the COVID-19 pandemic, the general position was that all documents submitted for registration were required to be executed with a “wet ink” signature.
In response to social distancing restrictions as a result of the pandemic, the Land Registry reformed its approach to electronic signatures and releases regular and updated guidance to set out the different forms of electronic signatures, which it will accept for certain documents.
The electronic signatures which are accepted by the Land Registry are summarised below.
Mercury signatures
This method involves a scanned manuscript “wet ink” signature being added to a document.
It is a requirement that if proceeding under this method, all parties to the transaction must be represented by a conveyancer (subject to limited exceptions) and agree to the Mercury signing in this way. In addition, certain steps must also be followed as set out by the Land Registry.
The majority of Land Registry documents can be signed by this method, excluding digital mortgages, forms ID1, ID2, ID3, ID4 and ID5, lasting powers of attorney and statutory declarations.
Conveyancer-certified electronic signatures
This method involves a signatory adding their signature electronically to a document in the presence of a witness, by way of an operating system or platform which manages the signing process and creates the electronic signature.
As part of this process an audit trail is created setting out the time and date of the signature and the recipient email addresses, amongst other identifiable information for the signing party. A conveyancer then provides the Land Registry with a certificate concerning the signature when lodging the relevant application.
As with the mercury method, it is a requirement that all parties are represented by a conveyancer (again, subject to limited exceptions) and agree to the use of conveyancer-certified electronic signatures. In addition, a conveyancer must be responsible for setting up and controlling the signing process through the platform and certain steps as set out by the Land Registry must be followed. There is no particular list of providers accepted or recommended by the Land Registry.
Parties can utilise “Mixed signing”, where one party signs in “wet ink” or under the Mercury Method and the other party signs by way of the Conveyancer-certified electronic method by the signing of counterpart deeds.
The Land Registry will accept most documents being electronically signed in this method excluding Panel 11 of form RX1, form UN1, digital mortgages, certain conveyancer certificates, forms ID1, ID2, ID3, ID4 and ID5, lasting powers of attorney, letters of objection and statutory declarations.
Electronic signing by Companies
Where a deed or document is being signed on behalf of a company by two “authorised signatories”, the process is much the same as above, however the steps to be followed are modified according to the separate methods.
There is however a question over whether a company can use a form of electronic company seal, as the wording of section 45 of the Companies Act 2006 appears to make reference to a physical seal. Unless the wording of the Companies Act 2006 is amended, it is extremely unlikely that an electronic seal will be deemed acceptable by the Land Registry.
Qualified electronic signatures
The Land Registry is currently accepting these advanced type of signatures in limited circumstances under a pilot scheme. The key features of this type of signature are that the signature is linked to and capable of identifying the signatory, linked to the signed data so that any changes can be detected, supported by a ‘qualified certificate’ issued by a ‘qualified trust service provider’ and created using a qualified signature creation device which meets certain technical and security requirements.
Commentary
Although electronic signatures are not available for use on every deed or document, it is evident that the Land Registry is taking positive steps towards modern methods of signing and this is a clear indicator of where the future lies. We envisage in the coming years (or even months) that there will be an increased uptake in the use of operating systems or platforms in the provision of electronic signing and this will be welcomed across more than just the Property industry.
At Bromleys, we already utilise the signing of certain deeds and documents via DocuSign which has proven extremely successful in reducing delays with the signing of documentation by parties to transactions whilst providing a clear audit trail of the document in the process.
This method has proven itself invaluable in particular during the recent spate of Royal Mail postal strikes and enabled us to, to a large extent, carry on with business as normal.
How we can help
To find out how we can assist, contact our team on 0161 330 6821 for your free initial telephone discussion. If you prefer, you can fill in our online form or alternatively, you can email us on bromleys@bromleys.co.uk.