Execution of documents

Electronic execution

eSignatures cannot generally be used to sign deeds. However, eSignatures are currently (temporarily) permitted due to the COVID-19 pandemic under some circumstances as set out below.

Can I use an eSignature to sign documents due to COVID-19?

eSignatures cannot generally be used to sign deeds. However, eSignatures are currently (temporarily) permitted due to the COVID-19 pandemic under some circumstances as set out below.

Can I use an eSignature to sign documents due to COVID-19

eSignatures cannot generally be used to sign deeds, and there is a risk of invalidity for using eSignatures to sign agreements too.  However, eSignatures are currently permitted under some circumstances:

  • when signing under section 127 of the Corporations Act (without a common seal);
  • in NSW, when specific video-witnessing requirements are met;
  • in Victoria, under certain conditions; and
  • in Queensland, under certain conditions.

These are temporary measures during the COVID-19 pandemic that have been extended until various dates in 2021 and 2022 or have been made permanent (in the case of Victoria).

eSigning under section 127

The Treasury Laws Amendment (2021 Measures No. 1) Act 2021 (Cth)  (the Commonwealth Measures) (temporarily) permits electronic and split executions pursuant to section 127 of the Corporations Act (Cth) during the COVID-19 pandemic. These measures have been extended until 31 March 2022, but draft legislation making permanent changes to allow for electronic execution under section 127 has been released.

Before the Commonwealth Measures, there was a divergence of opinion as to whether electronic execution or split execution could be effective under section 127.  Although Commonwealth legislation exists that permits transactions to occur electronically (see the Electronic Transactions Act 1999 (Cth)), this legislation does not apply to the Corporations Act.

Comments by Stanley J in obiter in Bendigo and Adelaide Bank Limited v Pickard [2019] SASC questioned the validity of split executions and electronic execution generally (that is, section 127 requires officers of a company to execute a single, static physical document).

This uncertainty meant that in practice when companies executed under section 127 many did so by wet ink signature only.

The Commonwealth Measures provide that execution under section 127 can be done:

  • electronically – in which case, the method of electronic execution must be reliable and appropriate for the purposes (or proven in fact) to identify and indicate the person’s intention in respect of the contents of the document (which mirrors the approach under the Electronic Transactions Act 1999(Cth)); and
  • where more than one signatory is required, permits the use of ‘split executions’ – where the two officers of a company execute separate counterparts of a document, whether in electronic or physical form.

In each case, the signature (whether physical or electronic) must be affixed to the entire document, but does not need to include the signature of any other person who has/will be signing the document.  That is, the practice of signing an execution page that has been separated from the remainder of the document will not meet the requirements of the Commonwealth Measures.

The Commonwealth Measures also extends the statutory assumption under section 129(5) of the Corporations Act to documents that appear to have been executed in accordance with the Commonwealth Measures.

Under these new rules, a much wider range of methods can be used to sign documents, including copying and pasting a signature into a document and using cloud-based electronic execution tools.  As signatories do not need to sign the same copy of a document, it is now possible for 2 directors/company secretary to sign separate copies of the same document.

The Commonwealth Measures do not relax the practical need for companies to retain a copy of executed documents, and where ‘split execution’ occurs, copies of each executed document should be retained.  Given the express requirements of the Commonwealth Measures regarding signatures being affixed to the entire document, the entire signed document should be retained (and not just the signature pages).

The Commonwealth Measures do not change the existing position under section 127 for execution using a common seal.  The Commonwealth Measures also do not affect the laws or requirements of any other jurisdiction which may limit which documents can be executed electronically.

eSigning in NSW

The Electronic Transactions Amendment (COVID-19 Witnessing of Documents) Regulation 2020 (the NSW Regulations) have been introduced to provide for altered arrangements for witnessing of signatures and the attestation of certain documents governed by NSW law.  These changes have been extended until the end of 2021.

The changes to permit witnessing and attesting via audio visual link apply to wills, powers of attorney (or enduring power of attorney), deeds or agreements, enduring guardianship appointments, affidavits and statutory declarations governed by NSW law.

The NSW Regulations do not change which documents may or may not be executed electronically in NSW – only how documents may be witnessed and attested. However, they pave the way for deeds to be signed electronically because they allow remote witnessing.

The NSW Regulations make a number of changes, including:

  • Permitting remote witnessing of signatures and attestation of documents by audio visual link (which would include via video-technology that enables a continuous and contemporaneous audio and visual communication between persons at different places, such as Skype, WhatsApp, FaceTime and Zoom) provided certain conditions are met, including that the witness must:
    • observe the signatory sign the document in real time (on a practical note, this will require the act of signing to be seen on-screen (for example, witnessing the hand of the signatory sign the document, whether by wet signature or electronically));
    • confirm they witnessed the signature, either by signing a counterpart of the signed document, or, where the signatory scans and sends a copy of the signed document to the witness electronically, by countersigning that document;
    • include a statement specifying the method used to witness the signatory’s execution and that the document was witnessed in accordance with the Regulations; and
    • be reasonably satisfied the document they sign is the same document, or a copy of the document, that they observed the signatory sign.

The NSW Regulations do not require a witness to be physically located in NSW when witnessing a signature by audio-video link.  They also do not seek to limit the ways that a witness may confirm the signature was witnessed, provided the conditions are met.  However, the example methods provided for in the NSW Regulations all refer to the witness signing a copy of the document – the advantage of these methods is that they mitigate the risk of the witness confirming a different document from that which was signed. Whatever method is used to confirm, the witness should do so as soon as practicable after having witnessed the signature.

  • Allowing an Australian legal practitioner to take or make any oath declaration or affidavit required for the purpose of any court or tribunal; for the registration of any instrument; or for any arbitration.  (Normally, the position in NSW is that these can only be made or taken by a justice of the peace, a notary public, a British Consular Officer or an Australian Consular Officer.)
  • Allowing statutory declarations (other than those required for the purposes of any court or tribunal to which the above applies) to be made before a broader range of “authorised witnesses” to include dentists, pharmacists, medical practitioners and veterinary surgeons, among others.  This change temporarily brings the NSW position on “authorised witnesses” in line with the existing Commonwealth position.

The NSW Regulations address the uncertainly around using cloud-based eSignature tools (such as AdobeSign and DocuSign) to witness documents.  As, provided the conditions in the Regulations are met, it is acceptable that the functionality in these tools creates a separate identical copy of the document for the witness to affix their signature.

The NSW Regulations also do not affect the laws or requirements of any other jurisdiction.  Similar reforms have been introduced in Victoria and Queensland, however there are no temporary measures for electronic signing in other Australian jurisdictions.

Could I use an eSignature to sign a deed (prior to COVID-19)?

eSignatures cannot generally be used to sign deeds.  However, eSignatures are (temporarily) permitted due to the COVID-19 pandemic under some circumstances.  Please refer to the section Can I use an eSignature to sign documents due to COVID-19?

Subject to the exception in NSW noted below, and more recently, Victoria, Australian law does not recognise the validity of a deed which exists in electronic form. The common law requirement that deeds be on ‘paper, parchment or vellum’ prevails, meaning that deeds purported to be executed in electronic form with eSignatures are not valid.

However, if the requirements for an agreement are otherwise met (i.e. there is consideration), a court may find that such a ‘deed’ takes effect as a contract, which can exist in electronic form (the ‘paper, parchment or vellum’ common law requirement for deeds has never been recognised as extending to ordinary agreements) and can in some cases be signed electronically (discussed in further detail below).

Specifically in NSW, following the commencement of the Conveyancing Legislation Amendment Act 2018 (NSW) on 22 November 2018, s 38A of the Conveyancing Act 1919 (NSW) (NSW Conveyancing Act) now permits deeds to be created (and therefore exist) in electronic form and to be electronically signed and attested in accordance with Part 3 of the NSW Conveyancing Act.

Section 38(1) of the NSW Conveyancing Act (one of the sections in Part 3), then provides that every deed (whether or not affecting property) shall be signed as well as sealed and shall be attested by at least one witness not being a party to the deed.

While it may be thought that deeds can accordingly be signed electronically in NSW, the lowest risk position is that all deeds should continue to be physically printed and signed by wet signature. That is for two reasons.

First, in the case of companies, s 38(5)(a) of the NSW Conveyancing Act expressly states that the execution requirements set out in s 38 do not affect ‘the execution of deeds by corporations’.

As a result, the NSW Conveyancing Act cannot be seen of itself to provide an alternative way for a company to execute a deed.

If a company relies on execution under s 127 of the Corporations Act by the signature of two directors, a director and company secretary or the sole director and secretary of a proprietary company, or the witnessing of the fixing of the company’s seal by those persons (see the discussion in the Execution of Deeds section of this app), that would ordinarily trigger the operation of s 10 of the Electronic Transactions Act 1999 (Cth) (ETA).  That is because s 127 of the Corporations Act may be read as a law of the Commonwealth requiring the signature of a person within the meaning of s 10 of the ETA.

Importantly, s 10 of the ETA applies to validate a document executed electronically provided the conditions in s 10 are satisfied (including proper identification and confirmation of the intention of the person signing the document and consent to the use of an electronic signature by the counterparty).

However, s 10 is specifically excluded from applying to the Corporations Act by item 30 of schedule 1 of the Electronic Transactions Regulations 2000 (Cth).

Arguably, the specific exclusion of the Corporations Act from the scope of the ETA is extrinsic evidence of the Commonwealth Parliament’s intention that a company should not be able to execute a deed (or an agreement) electronically.

It would remain open for a company to execute a deed under s 126 of the Corporations Act (but as noted in the Execution of Deeds section of this app, authority to execute a deed, as opposed to an ordinary agreement, must itself be conferred by deed and not just a board resolution). Unlike s 127, the terms of s 126 cannot be read as imposing a requirement for the signature of a person on behalf of a company, so that the ETA (and more importantly the inference against the validity of an electronic signature to be drawn from the exclusion of the Corporations Act from the operation of the ETA) would not apply.  In that case, arguably the electronic execution of a deed by an agent on behalf of a company, if expressly authorised by the company in a deed, could be valid.  However, there is no direct case law on point and in any event, in practice, it is common for a counterparty to insist on execution under s 127 so that the counterparty can take advantage of the presumptions of regular execution under ss 128 and 129 of the Corporations Act (see the discussion in the Execution of Deeds section of this app).

Secondly, for natural persons, a further problem is that, under s 38(1A) of the Conveyancing Act, a deed executed by an individual must be witnessed.  It is not clear exactly how electronic witnessing can occur and no guidance is provided by the Conveyancing Act.

It is arguable that online signature tools may create a new copy of a document with each new execution, which would mean that the requirement for a witness to sign the same deed as the underlying signatory in the presence of that signatory would not be satisfied.

Pending any further legislative amendments to the Conveyancing Act (including by way of regulations) and, in the case of companies, s 127 of the Corporations Acta deed should be executed by way of wet signature in all Australian jurisdictions to ensure the deed is valid.

What is an eSignature?

An electronic signature or eSignature is a term used to describe a class of methods for electronically replicating or replacing a paper signature (a paper signature is sometimes called a ‘wet signature’ referring to the use of ink and to distinguish it from an eSignature).

There are many ways in which an eSignature can be created, including:

  • scanning a paper signature and inserting it in an electronic document (or multiple documents over time);
  • clicking on an “agree” button on a website;
  • signing using a digital pen, finger or a mouse onto a trackpad;
  • typing your name; or
  • using a web-based authentication system to affix an electronic version of your signature to a document.

The concept of an eSignature has not been defined by Australian law. The UNCITRAL Model Law on Electronic Signatures 2001, defines an electronic signature as follows:

“Electronic signature” means data in electronic form in, affixed to or logically associated with, a data message, which may be used to identify the signatory in relation to the data message and to indicate the signatory’s approval of the information contained in the data message.

Can I use an eSignature to sign a deed?

eSignatures cannot be used to sign deeds. 

Subject to the exception in NSW noted below, Australian law does not recognise the validity of a deed which exists in electronic form. The common law requirement that deeds be on ‘paper, parchment or vellum’ prevails, meaning that deeds purported to be executed in electronic form with eSignatures are not valid.

However, if the requirements for an agreement are otherwise met (i.e. there is consideration), a court may find that such a ‘deed’ takes effect as a contract, which can exist in electronic form (the ‘paper, parchment or vellum’ common law requirement for deeds has never been recognised as extending to ordinary agreements) and can in some cases be signed electronically (discussed in further detail below).

Specifically in NSW, following the commencement of the Conveyancing Legislation Amendment Act 2018 (NSW) on 22 November 2018, s 38A of the Conveyancing Act 1919 (NSW) (Conveyancing Act) now permits deeds to be created (and therefore exist) in electronic form and to be electronically signed and attested in accordance with Part 3 of the Conveyancing Act.

Section 38(1) of the Conveyancing Act (one of the sections in Part 3), then provides that every deed (whether or not affecting property) shall be signed as well as sealed and shall be attested by at least one witness not being a party to the deed.

While it may be thought that deeds can accordingly be signed electronically in NSW, the lowest risk position is that all deeds should continue to be physically printed and signed by wet signature.  That is for two reasons.

First, in the case of companies, s 38(5)(a) of the Conveyancing Act expressly states that the execution requirements set out in s 38 do not affect ‘the execution of deeds by corporations’.

As a result, the Conveyancing Act cannot be seen of itself to provide an alternative way for a company to execute a deed.

If a company relies on execution under s 127 of the Corporations Act by the signature of two directors, a director and company secretary or the sole director and secretary of a proprietary company, or the witnessing of the fixing of the company’s seal by those persons (see the discussion in the Execution of Deeds section of this app), that would ordinarily trigger the operation of s 10 of the Electronic Transactions Act 1999 (Cth) (ETA).  That is because s 127 of the Corporations Act may be read as a law of the Commonwealth requiring the signature of a person within the meaning of s 10 of the ETA.

Importantly, s 10 of the ETA applies to validate a document executed electronically provided the conditions in s 10 are satisfied (including proper identification and confirmation of the intention of the person signing the document and consent to the use of an electronic signature by the counterparty).

However, s 10 is specifically excluded from applying to the Corporations Act by item 30 of schedule 1 of the Electronic Transactions Regulations 2000 (Cth).

Arguably, the specific exclusion of the Corporations Act from the scope of the ETA is extrinsic evidence of the Commonwealth Parliament’s intention that a company should not be able to execute a deed (or an agreement) electronically.

It would remain open for a company to execute a deed under s 126 of the Corporations Act (but as noted in the Execution of Deeds section of this app, authority to execute a deed, as opposed to an ordinary agreement, must itself be conferred by deed and not just a board resolution). Unlike s 127, the terms of s 126 cannot be read as imposing a requirement for the signature of a person on behalf of a company, so that the ETA (and more importantly the inference against the validity of an electronic signature to be drawn from the exclusion of the Corporations Act from the operation of the ETA) would not apply.  In that case, arguably the electronic execution of a deed by an agent on behalf of a company, if expressly authorised by the company in a deed, could be valid.  However, there is no direct case law on point and in any event, in practice, it is common for a counterparty to insist on execution under s 127 so that the counterparty can take advantage of the presumptions of regular execution under ss 128 and 129 of the Corporations Act (see the discussion in the Execution of Deeds section of this app).

Secondly, for natural persons, a further problem is that, under s 38(1A) of the Conveyancing Act, a deed executed by an individual must be witnessed.  It is not clear exactly how electronic witnessing can occur and no guidance is provided by the Conveyancing Act.

It is arguable that online signature tools may create a new copy of a document with each new execution, which would mean that the requirement for a witness to sign the same deed as the underlying signatory in the presence of that signatory would not be satisfied.

Pending any further legislative amendments to the Conveyancing Act (including by way of regulations) and, in the case of companies, s 127 of the Corporations Act, a deed should be executed by way of wet signature in all Australian jurisdictions to ensure the deed is valid.

Could I use an eSignature to sign an agreement generally (prior to COVID-19)?

For electronic execution of an agreement, as opposed to a deed, it is necessary to distinguish between the position for companies and the position for natural persons.

For companies, the same position referred to above in relation to deeds applies to the execution of an agreement.

Specifically, s 127 of the Corporations Act by its terms extends to both deeds and agreements, so that if a company seeks to rely on execution under that section, the inference against the validity of an electronic signature to be drawn from the exclusion of the Corporations Act from the operation of s 10 of the ETA would apply.

Again, a company could still rely on s 126 of the Corporations Act to confer authority on a person to execute an agreement electronically on behalf of the company (and, unlike for a deed, authority to execute an ordinary agreement need not itself be conferred by deed – see the discussion in Execution of Agreements section of this app) and in that case it could be argued that electronic execution is valid.  However, in the absence of any specific case law on point, the safest course is for both deeds and agreements to be executed on behalf of a company by wet signature.  

For natural persons, generally there is no legal requirement that an agreement be signed (or even that it be in writing) and therefore there is no legal impediment to using an eSignature.

Similarly, many contracts are made online simply by selecting an ‘I agree to these terms and conditions’ checkbox and paying by credit card.  There is no question that contracts of that kind are legally valid and enforceable.

However, there are certain types of agreements that must be writing and/or signed in order to be legally binding.  These include contracts for the sale of land, certain building contracts and unsolicited sales contracts.  In those cases, the use of eSignatures will only be possible if:

  • Expressly authorised in the relevant legislation governing the transaction – this is very rare (one example being the electronic execution of a security agreement under the Personal Property Securities Act 2009(Cth));
  • authorised by implication under the relevant legislation governing the transaction – however, this basis of validation is very uncertain and we do not advise relying on it; or
  • the electronic execution complies with the relevant Electronic Transactions Act which applies in the jurisdiction selected by the parties to govern their transaction (there is an Electronic Transactions Actwith almost identical provisions in each state and territory, as well as at Commonwealth level).

If an eSignature is used in one of these cases, we recommend the following:

  • use a sophisticated e-signature tool which is in regular commercial use and has a sound reputation;
  • to maximise security, use additional available authentication options, such as two-factor authentication by a phone code or message;
  • advise the counterparty in advance that you intend to execute the agreement electronically; and
  • be as vigilant in reviewing a counterparty’s eSignature as you would be for any other signature. If something seems suspicious or unusual, it should be promptly investigated.
G+T Execution App

Correct execution is essential to creating a legally binding deed or agreement.   Use the G+T Execution App for assistance in finding the right execution block for your document.

Easy to use and with detailed notes and commentary throughout, the G+T Execution App can be accessed by clicking on the icon below.  For best use, access this on your desktop computer.

G+T Execution App
G+T Execution App
Key differences between deeds and agreements

The legal rules that apply to the execution of documents (and that ultimately determine whether an executed document is legally enforceable) depend on:

  • whether the document is a deed or an agreement; and
  • the type of person signing the document (i.e. a company or a natural person).

There are different rules for each type of document and each type of person. For example, unlike ordinary agreements, deeds executed by natural persons will generally need to be witnessed, a condition imposed by statute rather than common law (a point recently noted in Brown v Tavern Operatory Pty Ltd [2018] NSWSC 1290).  Further, all deeds only take effect when they are delivered (a legal concept focusing on when a party signing a deed intends to be bound) rather than simply executed.

The different legal rules are discussed in detail in the sections on Execution of Deeds, Execution of Agreements and Electronic Execution.

By way of background, deeds and agreements are both ways in which a ‘deal’ can be committed to writing by negotiating parties. Used in this way, deeds share many similarities with agreements, including how they are interpreted, varied and discharged. The remedies for breach are also similar.

However, there are important differences between deeds and agreements.  Perhaps the most important difference is that a party seeking to enforce a promise made to it in an ordinary agreement (whether written or oral) must have provided consideration for the promise. On the other hand, consideration is not necessary if the promise is contained in a deed.

For example, a third-party guarantee of a loan will ordinarily be made by deed because arguably the guarantor does not receive any consideration from the lender for guaranteeing the loan to the primary borrower (unless the consideration is construed as being the benefit of the lender continuing to advance funds to the borrower, who the guarantor has an interest in supporting).  If the guarantee is executed as a deed rather than an agreement, any dispute about lack of consideration can be avoided.  On the other hand, execution of the guarantee as an agreement could result in the  agreement being unenforceable for lack of consideration.

Although consideration is not strictly necessary if a promise is contained in a deed, it is still common for at least a nominal amount of consideration to be included in deeds.  This is because of the rule that equity will not assist a volunteer.  The effect of that rule is to bar recourse to equitable remedies such as specific performance if there is no consideration given for a promise that is received.  Nominal consideration can be provided with a term to the effect that ‘Party A agrees to pay Party B the sum of $10.’

Another difference between deeds and agreements is that deeds have a longer limitation period for bringing legal proceedings arising out of the underlying transaction entered into between the parties, being at least double that for a breach of an agreement in all Australian jurisdictions.

Deeds are typically used instead of agreements in the following circumstances:

  • where there may not be consideration for the promise. Apart from the example of a third-party loan guarantee noted above, another case in which deeds are commonly used instead of agreements is where a confidentiality undertaking is provided – in such a case, arguably the party receiving the undertaking does not provide consideration;
  • where a party wishes to preserve a longer limitation period to enforce any disputes which may arise;
  • because of the ritual or gravitas of using a deed. In that regard, a deed has been defined as the most solemn act a person can perform with respect to a piece of property or other right. Deeds are a creation of the common law, dating back to around 700 AD. In many instances, parties prefer to use deeds rather than agreements simply because of their symbolic value rather than for any legal reason; and
  • where statute requires it. For example, when conveying old system (non-Torrens title) land a deed is required.
Execution of deeds
Individuals

Execution block
Click here to download an execution block for a deed to be executed by an individual.

Use of this execution block
This is an execution block for an individual to execute a deed. It should be used in conjunction with the important notes which follow below.

Use this block for executing deeds only
This execution block should only be used for executing deeds.

While the courts take the view that a document can still be classified as a deed even if it is not expressly stated to be a deed, with the parties’ intention for a document to be a deed able to be inferred from all the surrounding circumstances (see the recent cases of Realm Resources Ltd v Aurora Place Investments Pty Ltd [2019] NSWSC 379, [67]-[68] and Bendigo and Adelaide Bank Ltd v DY Logistics Pty Ltd [2018] VSC 558, [23]), to avoid any doubt, the document should be expressed to be a deed in the execution block.

For executing agreements instead of deeds, please refer to the Execution of Agreements section of this app.

Do not use this execution block outside Australia or where the laws of another country may apply
This execution block has been drafted for use within Australia only, and for deeds that are subject to Australian law. If the law of the deed is that of another jurisdiction and/or the deed is to be executed outside Australia, specialist advice should be sought.

The signature must be witnessed
This execution block provides for the individual who is executing the deed to have their signature witnessed. The witness must be present when the deed is executed.

The execution block has been drafted so that it complies with the laws relating to execution of deeds by an individual in all states and territories in Australia. While witnessing is not strictly necessary under the laws of Victoria, it is recommended that the requirement not be removed for Victoria as witnessing serves an evidentiary as well as a legal purpose. Witnessing is necessary in all other states and territories as a matter of statute as opposed to the common law – see Brown v Tavern Operator Pty Ltd [2018] NSWSC 1290.

Where a person is required to witness signatures on a deed, the witness must not be a party to the deed.  Ideally, a witness should also not be a representative, relative or employee of a party to the deed.

There are specific requirements that must be complied with for a person to act as a witness for a real property transaction. Consider obtaining specialist advice in these circumstances.

Sealing is not required
This execution block states that the document is a deed and that it is sealed. The purpose of these statements is to engage statutory provisions which deem the document to be sealed when this language is used. It is therefore not necessary to actually seal the deed when using this execution block.

Delivery
A deed will take effect from the time it is delivered rather than when it is simply dated or executed. ‘Delivery’ does not mean physical delivery but rather the point at which the executing party intends to be bound.

This is ultimately a question of fact to be determined objectively in each individual case with reference to ‘the words and conduct of the executing party and the circumstances surrounding the execution of the deed’ – see the decision of the NSW Court of Appeal in Segboer v AJ Richardson Properties Pty Ltd [2012] NSWCA 253, [59]-[60], recently cited with approval in Realm Resources Ltd v Aurora Place Investments Pty Ltd [2019] NSWSC 379, [71].

There is no general presumption that a party intends to be immediately bound simply by executing a deed. Indeed, it is common for the surrounding circumstances to indicate an intention that the parties do not intend to be bound until all executed counterparts of a deed have been exchanged, and typically there is an express clause in the parties’ deed which provides for this.

A deed can also be delivered ‘in escrow’. Escrow is a form of conditional delivery, the condition being to delay the operation of the terms until the condition is satisfied. For example, a deed may be delivered in escrow for another party to sign.

With a delivery in escrow, the party that delivers the deed is bound by and cannot resile from the deed until the condition is fulfilled. However, if the condition is not fulfilled in the contemplated time then the party can seek equitable relief for the deed to be delivered up and cancelled.

Where there is any doubt about when delivery is to take effect (including the terms of any escrow), this should be explicitly stated, preferably in the deed itself.

Electronic signatures and electronic deeds
Usually electronic signatures should not be used to execute deeds. The reasons for this are discussed in detail in the Electronic Execution section. However, eSignatures are (temporarily) permitted during the COVID-19 pandemic under some circumstances.  Please refer to Can I use an eSignature to sign documents during COVID-19?

Do not pre-sign signature pages
Signature pages should never be ‘pre-signed’ and attached to a deed. Instead the whole deed should be printed, the pages securely fastened and then the deed executed.

Stamp duty
Stamp duty may be payable on the execution of a deed. Consider seeking specialist tax advice.

Disclaimer
This execution block and accompanying explanatory notes are general information and are not intended as advice on any particular matter.  They have been created to assist in-house legal counsel with some key legal and practical requirements which commonly arise in the execution of deeds and agreements. The material assumes a certain level of legal understanding. It is not intended to provide an exhaustive guide nor is it a replacement for legal advice tailored to specific circumstances.

No user should act or fail to act on the basis of any of this material.  Gilbert + Tobin expressly disclaims all and any liability to any persons whatsoever in respect of anything done in reliance, whether in whole or in part, on this material.

Individuals as attorneys

Click here to download an execution block for a deed to be executed by an individual as attorney.

Use of this execution block
This is an execution block for an individual to execute a deed as an attorney. The execution block can be used for an individual executing a deed as attorney for either an individual or a company. It should be used in conjunction with the important notes which follow below.

Use this block for executing deeds only
This execution block should only be used for executing deeds.

As noted earlier in the Execution of Deeds section in the context of the execution of a deed by an individual in his or her own capacity, while it is possible for a document to be taken to exist as a deed even if that is not expressly stated (see Realm Resources Ltd v Aurora Place Investments Pty Ltd [2019] NSWSC 379, [67]-[68] and Bendigo and Adelaide Bank Ltd v DY Logistics Pty Ltd [2018] VSC 558, [23]), to avoid any doubt, the document should be expressed to be a deed in the execution block.

For executing agreements rather than deeds please refer to the Execution of Agreements section of this app.

Do not use this execution block outside Australia or where the laws of another country may apply
This execution block has been drafted for use within Australia only, and for deeds that are subject to Australian law. If the law of the deed is that of another jurisdiction and/or the deed is to be executed outside Australia, specialist advice should be sought.

Attorney must be appointed by deed
You should review the authorising deed to ensure that it has been validly executed and that the attorney who will be executing the deed has authority under the authorising deed to do so.

Importantly, an attorney may only execute a deed (rather than an agreement) on behalf of another person (individual or company) if he or she has been appointed by deed (rather than by a verbal or written agreement or other acknowledgement) to do so – see MYT Engineering Pty Ltd v Mulcon Pty Ltd (1999) 195 CLR 636.  The usual way to do this is by the principal granting a power of attorney in the form of a deed.

It follows that a board resolution appointing an officer to execute a deed on behalf of the company would not, of itself, be sufficient to confer authority on the officer and to validate any deed later executed by the officer – see Torrens Redevelopment & Research Pty Ltd v Oakworth Developments Pty Ltd [2008] NSWSC 1096.

Attorney signs their own name
This execution block provides for the attorney to sign their own name. An attorney can sign in their own name if either:

  • the power of attorney expressly permits them to do so; and/or
  • the power of attorney is governed by the law of a jurisdiction which has a statutory provision allowing the attorney to sign in their own name (currently NSW, NT (unless a contrary intention appears in the power of attorney), Qld, Tas, Vic and WA).

Outside these circumstances, the attorney may not be able to sign in their own name and specialist advice should be sought.

Statutory assumptions of due execution where attorney signs for company
Where a company executes a deed by an attorney, the important presumptions of due execution under ss 128-129 of the Corporations Act 2001 (Cth) are not available in relation to the deed itself as the execution is not in accordance with ss 127(1) or 127(2).  However, those presumptions  will be available in relation to the execution of the underlying power of attorney if it has been executed under s 127.

Sections 127-129 of the Corporations Act are discussed in further detail later in the Execution of Deeds section of this app.

Registration of powers of attorney
There is a statutory requirement in most jurisdictions that any power of attorney authorising dealings with land must be registered to give validity to those dealings. The only exceptions to this general rule are Western Australia (although a power of attorney may be deposited with the Land Information Authority) and Victoria (where no power of attorney is required to be registered although a certified copy of the power of attorney must be lodged with the Land Titles Office).

In Tasmania, all powers of attorney are required to be registered. In the ACT, there are additional registration requirements for powers of attorney which are created in respect of conveyances or deeds.

The registration requirements in the various jurisdictions (including the precise circumstances in which registration is required) fall outside of the scope of this app. If registration of the power of attorney may be required, specialist advice should be sought. This execution clause may not be appropriate where registration is required.

As a general rule, if an instrument is executed under an invalid power of attorney or a power of attorney that post-dates the signed instrument, registering the power of attorney will not validate the instrument.

The signature must be witnessed
This execution block provides for the individual who is executing the deed as an attorney to have their signature witnessed. The witness must be present when the deed is executed.

The execution block has been drafted so that it complies with the laws relating to execution of deeds by an individual in all states and territories in Australia. While witnessing is not strictly necessary under the laws of Victoria, it is recommended that the requirement not be removed for Victoria as witnessing serves an evidentiary as well as a legal purpose. Witnessing is necessary in all other states and territories.

Where a person is required to witness signatures on a deed, the witness must not be a party to the deed.  Ideally, a witness should also not be a representative, relative or employee of a party to the deed.

There are specific requirements that must be complied with for a person to act as a witness for a real property transaction. Consider obtaining specialist advice in these circumstances.

Sealing is not required
This execution block states that the document is a deed and that it is sealed. The purpose of these statements is to engage statutory provisions which deem the document to be sealed when this language is used. It is therefore not necessary to actually seal the deed when using this execution block.

Delivery
As noted earlier in the Execution of Deeds section of this app in the context of the execution of a deed by an individual in his or her own capacity, execution by an attorney will only take effect from the time the deed is delivered rather than when it is dated or executed.

Again, ‘delivery’ refers to the time at which a party intends to be bound and this is an objective question of fact to be determined in all the circumstances of an individual case, without any presumption of an intention to be bound merely by execution of the deed – see Segboer v AJ Richardson Properties Pty Ltd [2012] NSWCA 253, [59]-[60] and Realm Resources Ltd v Aurora Place Investments Pty Ltd [2019] NSWSC 379, [71].

Where there is any doubt about when delivery is to take effect (including the terms of any escrow), this should be explicitly stated, preferably in the deed itself.

Electronic signatures and electronic deeds
Usually electronic signatures should not be used to execute deeds. The reasons for this are discussed in detail in the Electronic Execution section. However, eSignatures are (temporarily) permitted during the COVID-19 pandemic under some circumstances. Please refer to Can I use an eSignature to sign documents during COVID-19?

Do not pre-sign signature pages
Signature pages should never be ‘pre-signed’ and attached to a deed. Instead the whole deed should be printed, the pages securely fastened and then the deed executed.

Stamp duty
Stamp duty may be payable on the execution of a deed. Consider seeking specialist tax advice.

Disclaimer
This execution block and accompanying explanatory notes are general information and are not intended as advice on any particular matter. They have been created to assist in-house legal counsel with some key legal and practical requirements which commonly arise in the execution of deeds and agreements. The material assumes a certain level of legal understanding. It is not intended to provide an exhaustive guide nor is it a replacement for legal advice tailored to specific circumstances.

No user should act or fail to act on the basis of any of this material. Gilbert + Tobin expressly disclaims all and any liability to any persons whatsoever in respect of anything done in reliance, whether in whole or in part, on this material.

General partnerships

Execution block
Click here to download an execution block for a deed to be executed by an individual on behalf of a general partnership.

Use of this execution block
This is an execution block for an individual partner to execute a deed on behalf of a general partnership. It should be used in conjunction with the important notes which follow below.

Use this block for executing deeds only
This execution block should only be used for executing deeds.

As noted earlier in the Execution of Deeds section in the context of the execution of a deed by an individual in his or her own capacity, while it is possible for a document to be taken to exist as a deed even if that is not expressly stated (see Realm Resources Ltd v Aurora Place Investments Pty Ltd [2019] NSWSC 379, [67]-[68] and Bendigo and Adelaide Bank Ltd v DY Logistics Pty Ltd [2018] VSC 558, [23]), to avoid any doubt, the document should be expressed to be a deed in the execution block.

For executing agreements instead of deeds, please refer to the Execution of Agreements section of this app.

Do not use this execution block outside Australia or where the laws of another country may apply
This execution block has been drafted for use within Australia only, and for deeds that are subject to Australian law. If the law of the deed is that of another jurisdiction and / or the deed is to be executed outside Australia, specialist advice should be sought.

Partner executing on behalf of partnership must be appointed by deed
You should review the authorising deed to ensure that it has been validly executed and that the partner who will be executing the deed has authority under the authorising deed to do so.

Importantly, a partner may only execute a deed (rather than an agreement) on behalf of a general partnership if he or she has been appointed by deed (rather than by a verbal or written agreement or other acknowledgement) to do so.

The existence of a partnership deed is not sufficient unless that deed expressly provides that an individual partner has the power to execute a deed so as to bind the partnership.

If the partnership deed does not provide for one partner to execute a deed to bind the partnership, then a power of attorney to that effect which is executed as a deed will be a sufficient authorising document. However, that power of attorney must itself be validly executed as a deed by the partnership.

There are narrow exceptions where the above criteria are not satisfied by which a partnership can sign a deed. They are:

  • in the absence of a deed authorising one partner to execute a deed on behalf of the partnership, all of the partners must execute the deed for it to be valid; and
  • the general law also allows one partner to sign the deed if done so in the presence of all of the other partners.

This execution block is not appropriate for those situations which are outside the scope of this app.

Registration of powers of attorney
There is a statutory requirement in most jurisdictions that any power of attorney authorising dealings with land must be registered to give validity to those dealings. The only exceptions to this general rule are Western Australia (although a power of attorney may be deposited with the Land Information Authority) and Victoria (where no power of attorney is required to be registered although a certified copy of the power of attorney must be lodged with the Land Titles Office).

In Tasmania, all powers of attorney are required to be registered. In the ACT, there are additional registration requirements for powers of attorney which are created in respect of conveyances or deeds.

The registration requirements in the various jurisdictions (including the precise circumstances in which registration is required) fall outside of the scope of this app. If registration of the power of attorney may be required, specialist advice should be sought. This execution clause may not be appropriate where registration is required.

As a general rule, if an instrument is executed under an invalid power of attorney or a power of attorney that post-dates the signed instrument, registering the power of attorney will not validate the instrument.

The signature must be witnessed
This execution block provides for the individual partner who is executing the deed on behalf of the partnership to have their signature witnessed. The witness must be present when the deed is executed.

The execution block has been drafted so that it complies with the laws relating to execution of deeds by an individual in all states and territories in Australia. While witnessing is not strictly necessary under the laws of Victoria, it is recommended that the requirement not be removed for Victoria as witnessing serves an evidentiary as well as a legal purpose. Witnessing is necessary in all other states and territories.

Where a person is required to witness signatures on a deed, the witness must not be a party to the deed.  Ideally, a witness should also not be a representative, relative or employee of a party to the deed.

There are specific requirements that must be complied with for a person to act as a witness for a real property transaction. Consider obtaining specialist advice in these circumstances.

Sealing is not required
This execution block states that the document is a deed and that it is sealed. The purpose of these statements is to engage statutory provisions which deem the document to be sealed when this language is used. It is therefore not necessary to actually seal the deed when using this execution block.

Delivery
As in the case of the execution of a deed by an individual in his or her own capacity (see Execution of Deeds section), execution on behalf of a general partnership will only take effect from the time the deed is delivered rather than when it is dated or executed.

Again, ‘delivery’ refers to the time at which a party intends to be bound and this is an objective question of fact to be determined in all the circumstances of an individual case, without any presumption of an intention to be bound merely by execution of the deed – see Segboer v AJ Richardson Properties Pty Ltd [2012] NSWCA 253, [59]-[60] and Realm Resources Ltd v Aurora Place Investments Pty Ltd [2019] NSWSC 379, [71].

Where there is any doubt about when delivery is to take effect (including the terms of any escrow), this should be explicitly stated, preferably in the deed itself.

Electronic signatures and electronic deeds
Usually electronic signatures should not be used to execute deeds. The reasons for this are discussed in detail in the Electronic Execution section. However, eSignatures are (temporarily) permitted during the COVID-19 pandemic under some circumstances. Please refer to Can I use an eSignature to sign documents during COVID-19?

Do not pre-sign signature pages
Signature pages should never be ‘pre-signed’ and attached to a deed. Instead the whole deed should be printed, the pages securely fastened and then the deed executed.

Stamp duty
Stamp duty may be payable on the execution of a deed. Consider seeking specialist tax advice.

Disclaimer
This execution block and accompanying notes are general information and are not intended as advice on any particular matter.  They have been created to assist in-house legal counsel with some key legal and practical requirements which commonly arise in the execution of deeds and agreements. The material assumes a certain level of legal understanding. It is not intended to provide an exhaustive guide nor is it a replacement for legal advice tailored to specific circumstances.

No user should act or fail to act on the basis of any of this material.  Gilbert + Tobin expressly disclaims all and any liability to any persons whatsoever in respect of anything done in reliance, whether in whole or in part, on this material.

Company (with common seal)

Execution block
Download here an execution block for a deed to be executed by a company by fixing its common seal, as witnessed by:

  • two directors or a director and a company secretary; or
  • a sole director who is also the company secretary (in the case of a proprietary company).

Use of this execution block
This is an execution block for a company to execute a deed by fixing its common seal in the presence of either:

  • two directors or a director and a company secretary; or
  • a sole director and company secretary (in the case of a proprietary company).

The execution block should be used in conjunction with the important notes which follow below.

Use this block for executing deeds only
This execution block should only be used for executing deeds.

While it is possible for a document to be taken to exist as a deed even if that is not expressly stated (see Realm Resources Ltd v Aurora Place Investments Pty Ltd [2019] NSWSC 379, [67]-[68] and Bendigo and Adelaide Bank Ltd v DY Logistics Pty Ltd [2018] VSC 558, [23]), to avoid any doubt, the document should be expressed to be a deed in the execution block.

For executing agreements rather than deeds, please refer to the Execution of Agreements section of this app.

Execution pursuant to the Corporations Act 2001 (Cth) – two signatories
This execution block provides for execution pursuant to ss 127(2)(a), 127(2)(b) and 127(3) of the Corporations Act.  Under those provisions, a company (whether a proprietary company or a public company) can execute a document as a deed if the document is expressed to be executed as a deed the company’s common seal is fixed to the document and the fixing of the seal is witnessed by either:

  • two directors; or
  • a director and a company secretary.

The requirements of ss 127(2)(a), 127(2)(b) and 127(3) will not be satisfied if only one person witnesses the fixing of the company’s seal, even if that person is both a director and company secretary. Further, those provisions do not permit two company secretaries to witness the fixing of the company’s seal if neither is a director – at least one witness must be, or must also be, a director.

Importantly, a company can execute a deed in accordance with ss 127(2)(a), 127(2)(b) and 127(3) of the Corporations Act even if its constitution only provides for execution by an alternative method or is otherwise silent altogether as to the manner in which execution can occur.

Further, if a deed merely appears to have been executed in accordance with those provisions, a counterparty to the deed may make an assumption that the deed has been duly executed under ss 128 and 129(6) of the Corporations Act (provided the counterparty does not know or suspect the assumption is incorrect under s 128(4)).  In practice, because of the significant benefit this assumption provides to a counterparty (avoiding the need to have to prove authority as a threshold matter in the event of a dispute arising between the parties), counterparties will typically insist on execution pursuant to ss 127(2) and 127(3), or otherwise by way of signature in the manner contemplated by s 127(1).

Execution pursuant to the Corporations Act – one signatory
This execution block provides for execution pursuant to ss 127(2)(c) and 127(3) of the Corporations Act.  According to those provisions, a proprietary company (but not a public company) can execute a document as a deed if the document is expressed to be executed as a deed, the company’s common seal is fixed to the document and the fixing of the seal is witnessed by the sole director and secretary of the company. This method of execution can only be used by proprietary companies because public companies must have a minimum of three directors under s 201A(2) of the Corporations Act.

As noted in the Execution of Deeds section in relation to witnessing by two directors or a director and company secretary, it remains best practice to expressly state in the execution clause that a document is being executed as a deed to avoid any doubt as to the validity of the execution.

The requirements of ss 127(2)(c) and 127(3) will not be satisfied if the sole director of a proprietary company executes a deed in circumstances where the company has not appointed any company secretary (this is permitted by s 204A(1) of the Corporations Act). In that event, the only way to ensure the deed is properly executed under ss 127(2)(c) and 127(3) is for the director to appoint himself/herself as the company’s sole secretary as well.

Again, execution can take place under ss 127(2)(c) and 127(3) even if a company’s constitution provides for execution by an alternative method or is otherwise silent altogether as to the manner in which execution can occur.  The same presumption of regular execution referred to in the Execution of Deeds section in the context of witnessing of the fixing of a company’s common seal by two directors or a director and company secretary also applies in the case of witnessing by a sole director and company secretary of a proprietary company.

Ensure the correct people witness the fixing of the seal
Consider whether it is necessary or appropriate to undertake an ASIC search to establish the capacity of the people who are witnessing the fixing of the seal.

Do not use this execution block outside Australia or where the laws of another country may apply
This execution block has been drafted for use within Australia only, and for deeds that are subject to Australian law. If the law of the deed is that of another jurisdiction and/or the deed is to be executed outside Australia, specialist advice should be sought.

Use this execution block only for an Australian corporation
This execution block should only be used for Australian corporations which are registered under Chapter 2A of the Corporations Act. It should not be used for a foreign corporation (including a foreign corporation registered under Division 2 of Part 5B.2 of the Corporations Act).

Specialist advice should be sought in relation to the execution of deeds by foreign corporations.

Delivery
As with other forms of execution of a deed, where a deed purports to have been executed under ss 127(2) and 127(3) of the Corporations Act, it will only take effect from the time it is delivered rather than when it is dated or executed.

‘Delivery’ refers to the time at which a party intends to be bound and this is an objective question of fact to be determined in all the circumstances of an individual case, without any presumption of an intention to be bound merely by execution of the deed – see Segboer v AJ Richardson Properties Pty Ltd [2012] NSWCA 253, [59]-[60] and Realm Resources Ltd v Aurora Place Investments Pty Ltd [2019] NSWSC 379, [71].

A deed can also be delivered ‘in escrow’. Escrow is a form of conditional delivery, the condition being to delay the operation of the terms until the condition is satisfied. For example, a deed may be delivered in escrow for another party to sign.

With a delivery in escrow, the party which delivers the deed is bound by and cannot resile from the deed until the condition is fulfilled. However, if the condition is not fulfilled in the contemplated time then the party can seek equitable relief for the deed to be delivered up and cancelled.

Where there is any doubt about when delivery is to take effect (including the terms of any escrow), this should be explicitly stated, preferably in the deed itself.

Electronic signatures and electronic deeds
Usually electronic signatures should not be used to execute deeds. The reasons for this are discussed in detail in the Electronic Execution section. However, eSignatures are (temporarily) permitted during the COVID-19 pandemic under some circumstances. Please refer to Can I use an eSignature to sign documents during COVID-19?

Do not pre-sign signature pages
Signature pages should never be ‘pre-signed’ and attached to a deed. Instead, the whole deed should be printed, the pages securely fastened and then the deed executed.

Stamp duty
Stamp duty may be payable on the execution of a deed. Consider seeking specialist tax advice.

Disclaimer
This execution block and accompanying notes are general information and are not intended as advice on any particular matter.  They have been created to assist in-house legal counsel with some key legal and practical requirements which commonly arise in the execution of deeds and agreements. The material assumes a certain level of legal understanding. It is not intended to provide an exhaustive guide nor is it a replacement for legal advice tailored to specific circumstances.

No user should act or fail to act on the basis of any of this material.  Gilbert + Tobin expressly disclaims all and any liability to any persons whatsoever in respect of anything done in reliance, whether in whole or in part, on this material.

 

Company (without common seal)

Execution block
Download here an execution block for a deed to be executed by a company without affixing its common seal if the deed is signed by:

  • two directors or a director and a company secretary; or
  • a sole director who is also the company secretary (in the case of a proprietary company).

Use of this execution block
This is an execution block for a company to execute a deed without affixing its common seal if the deed is signed by:

  • two directors or a director and a company secretary; or
  • a sole director and company secretary (in the case of a proprietary company).

The execution block should be used in conjunction with the important notes which follow below.

Use this block for executing deeds only

This execution block should only be used for executing deeds.

As noted earlier in the Execution of Deeds section, while it is possible for a document to be taken to exist as a deed even if that is not expressly stated (see Realm Resources Ltd v Aurora Place Investments Pty Ltd [2019] NSWSC 379, [67]-[68] and Bendigo and Adelaide Bank Ltd v DY Logistics Pty Ltd [2018] VSC 558, [23]), to avoid any doubt, the document should be expressed to be a deed in the execution block.

For executing agreements rather than deeds, please refer to the Execution of Agreements section of this app.

Execution pursuant to the Corporations Act 2001 (Cth) – two signatories
This execution block provides for execution pursuant to ss 127(1)(a), 127(1)(b) and 127(3) of the Corporations Act. According to those provisions, a company can execute a document as a deed without using a common seal if the document is expressed to be executed as a deed and it is signed by:

  • two directors of the company; or
  • one director and one company secretary.

The requirements of ss 127(1)(a), 127(1)(b) and 127(3) will not be satisfied if only one person signs a deed on behalf of a company, even if that person is both a director and company secretary. Further, those provisions do not permit two company secretaries to sign a deed on behalf of a company – rather, at least one signatory must be, or must also be, a director.

A company can execute a deed in accordance with ss 127(1)(a), 127(1)(b) and 127(3) of the Corporations Act even if its constitution only provides for execution by an alternative method or is otherwise silent altogether as to the manner in which execution can occur.

Further, if a deed merely appears to have been executed by signature in accordance with ss 127(1)(a), 127(1)(b) and 127(3), a counterparty to the deed may make an assumption that the deed has been duly executed under ss 128 and 129(6) of the Corporations Act (provided the counterparty does not know or suspect the assumption is incorrect under s 128(4)).  In practice, the availability of this statutory presumption usually causes a counterparty to insist on execution by a company under s 127 of the Corporations Act.

Execution pursuant to the Corporations Act – one signatory
This execution block provides for execution pursuant to ss 127(1)(c) and 127(3) of the Corporations Act.  Under those provisions, a proprietary company (but not a public company) can execute a document as a deed if the document is expressed to be executed as a deed and is signed by the company’s sole director and secretary.

Again, it remains best practice to expressly state in the execution clause that a document is being executed as a deed to ensure compliance with section 127(3).

The requirements of ss 127(1)(c) and 127(3) will not be satisfied if the sole director of a proprietary company executes a deed in circumstances where the company has not appointed any company secretary (this is permitted by s 204A(1) of the Corporations Act). In that event, the only way to ensure the deed is properly executed under ss 127(1)(c) and 127(3) is for the director to appoint himself/herself as the company’s sole secretary as well.  Execution can take place under ss 127(1)(c) and 127(3) even if a company’s constitution provides for execution by an alternative method or is otherwise silent altogether as to the manner in which execution can occur.  Again, where a deed merely appears to have been signed by a sole director and company secretary of a proprietary company, there will be a presumption of due execution under ss 128 and 129(6) of the Corporations Act.

‘Split executions’ should be avoided
A so-called ‘split execution’ arises when the two officers of a company executing a deed under s 127(1) of the Corporations Act each sign on different physical copies of the document, usually because they are located in different places. There is an unresolved issue as to whether this constitutes valid execution of the document as a deed under s 127.

Only one published decision has considered the issue – Re CCI Holdings Ltd [2007] FCA 1283. In that case, Emmett J held that a deed poll was validly executed by a split execution. However, the issue was not dealt with at length in the judgment. Views amongst practitioners and academics vary as to whether a deed can validly be created under s 127 by a split execution.

A further issue is whether references to ‘the document’ in s 129(5) of the Corporations Act are satisfied where execution is split across two physical copies of a document.  If not, then the statutory assumption as to due execution in s 129(5) will not be available and this means that, in practice, a counterparty may not accept a split execution.

Given there are differing views on this issue (with some taking a more conservative view), in practice split execution should be avoided when executing deeds.

If parties are contemplating the execution of a deed under s 127 and there is a chance that split execution may be unavoidable, they should discuss at the earliest opportunity a position which is acceptable to all concerned. At the least, a wide counterparts clause should be included which states that signatures on behalf of a party may be on different counterparts. However, this provides no guarantee that split execution will be effective.

Ensure the correct people sign the deed
Consider whether it is necessary or appropriate to undertake an ASIC search to establish the capacity of the people who are signing the deed on behalf of the company.

Do not use this execution block outside Australia or where the laws of another country may apply
This execution block has been drafted for use within Australia only, and for deeds that are subject to Australian law. If the law of the deed is that of another jurisdiction and/or the deed is to be executed outside Australia, specialist advice should be sought.

Use this execution block only for an Australian corporation
This execution block should only be used for Australian corporations which are registered under Chapter 2A of the Corporations Act. It should not be used for a foreign corporation (including a foreign corporation registered under Division 2 of Part 5B.2 of the Corporations Act.

Specialist advice should be sought in relation to the execution of deeds by foreign corporations.

Delivery
As with other forms of execution of a deed, where a deed purports to have been executed under ss 127(1) and 127(3) of the Corporations Act, it will only take effect from the time it is delivered rather than when it is dated or executed.

This requires an assessment of when a party intends to be bound, an objective question of fact to be determined by examining all the surrounding circumstances and without any presumption of an intention to be immediately bound merely by executing a deed – see Segboer v AJ Richardson Properties Pty Ltd [2012] NSWCA 253, [59]-[60] and Realm Resources Ltd v Aurora Place Investments Pty Ltd [2019] NSWSC 379, [71].

Where there is any doubt about when delivery is to take effect (including the terms of any escrow), this should be explicitly stated, preferably in the deed itself.

Electronic signatures and electronic deeds
Never use electronic signatures to execute deeds. The reasons for this are discussed in detail in the Electronic Execution section.

Do not pre-sign signature pages
Signature pages should never be ‘pre-signed’ and attached to a deed. Instead the whole deed should be printed, the pages securely fastened and then the deed executed.

Stamp duty
Stamp duty may be payable on the execution of a deed. Consider seeking specialist tax advice.

Disclaimer
This execution block and accompanying notes are general information and are not intended as advice on any particular matter.  They have been created to assist in-house legal counsel with some key legal and practical requirements which commonly arise in the execution of deeds and agreements. The material assumes a certain level of legal understanding. It is not intended to provide an exhaustive guide nor is it a replacement for legal advice tailored to specific circumstances.

No user should act or fail to act on the basis of any of this material.  Gilbert + Tobin expressly disclaims all and any liability to any persons whatsoever in respect of anything done in reliance, whether in whole or in part, on this material.

Company by authorised signatory

An Australian company most likely cannot execute a deed (as opposed to an ordinary agreement) by ‘mere’ authorised signatory. For the reasons explained below, the law requires more.

In Australia, an attorney may only execute a deed (rather than an ordinary agreement) if he or she has been appointed by deed (rather than a verbal or written agreement) to do so – see MYT Engineering Pty Ltd v Mulcon Pty Ltd (1999) 195 CLR 636. This embraces the common law principle that authority to execute a deed must be given by deed.

As a result, a board resolution appointing an officer to execute a deed (as opposed to an ordinary agreement) as an authorised signatory for a company would not, of itself, be sufficient to ensure the validity of a deed later executed by the officer – see Torrens Redevelopment & Research Pty Ltd v Oakworth Developments Pty Ltd [2008] NSWSC 1096.

The usual way for a company to authorise an individual to execute a deed is by the corporate principal granting a power of attorney in the form of a deed. For execution by a duly appointed attorney under a power of attorney, see the detailed notes earlier in the Execution of Deeds section (which apply to the execution of a deed by an attorney on behalf of either an individual or a company).

It is sometimes suggested that s 126 of the Corporations Act may be employed to permit an authorised signatory to execute a deed for a company as agent, without a power of attorney in the form of a deed having been formally used to appoint the person as an authorised signatory. Although there is no definitive law on the point, this is thought unlikely for the following reasons:

  • s 126 refers only to contracts and not deeds; and
  • even if the section could be construed to include contracts in the form of deeds, the formal requirements for execution of deeds are probably preserved by s 126(2) which states that ‘[t]his section does not affect the operation of a law that requires a particular procedure to be complied with in relation to the contract.’

For these reasons, the execution of deeds on behalf of a company by mere authorised signatories, without a formal power of attorney having been previously granted to appoint the signatory as the company’s agent, is not recommended in Australia and may cause the deed which has been executed to be invalid.

Trusts – individual as trustee

Execution block
Click here to download an execution block for a deed to be executed by an individual as trustee.

Use of this execution block
This is an execution block for an individual to execute a deed as a trustee. It should be used in conjunction with the important notes which follow below.

Execution by trustees
Consider obtaining a certified up-to-date copy of the trust deed. There is no ‘indoor management rule’ which external persons can rely on when dealing with trusts.  Anyone dealing with a purported trustee will need to ensure that the trust is properly constituted, the trustee has been properly appointed and that they have power to execute the document.

If the trustee is not being required to give warranties about their authority then consider amending the execution block by adding the words ‘and in accordance with the trust deed dated [#]’ after inserting the name of the trust.

Use this block for executing deeds only
This execution block should only be used for executing deeds.

As noted earlier in the Execution of Deeds section in the context of the execution of a deed by an individual in his or her own capacity, while it is possible for a document to be taken to exist as a deed even if that is not expressly stated (see Realm Resources Ltd v Aurora Place Investments Pty Ltd [2019] NSWSC 379, [67]-[68] and Bendigo and Adelaide Bank Ltd v DY Logistics Pty Ltd [2018] VSC 558, [23]), to avoid any doubt, the document should be expressed to be a deed in the execution block.

For executing agreements rather than deeds, please refer to the Execution of Agreements section.

Do not use this execution block outside Australia or where the laws of another country may apply

This execution block has been drafted for use within Australia only, and for deeds that are subject to Australian law. If the law of the deed is that of another jurisdiction and/or the deed is to be executed outside Australia, specialist advice should be sought.

The signature must be witnessed
This execution block provides for the individual who is executing the deed as trustee to have their signature witnessed. The witness must be present when the deed is executed.

The execution block has been drafted so that it complies with the laws relating to execution of deeds by an individual in all states and territories in Australia. While witnessing is not strictly necessary under the laws of Victoria, it is recommended that the requirement not be removed for Victoria as witnessing serves an evidentiary as well as a legal purpose. Witnessing is necessary in all other states and territories.

Where a person is required to witness signatures on a deed, the witness must not be a party to the deed.  They should also not be a beneficiary of a trust executing the deed. Ideally, a witness should also not be a representative, relative or employee of a party to the deed.

There are specific requirements that must be complied with for a person to act as a witness for a real property transaction. Consider obtaining specialist advice in these circumstances.

Sealing is not required
This execution block states that the document is a deed and that it is sealed. The purpose of these statements is to engage statutory provisions which deem the document to be sealed when this language is used. It is therefore not necessary to actually seal the deed when using this execution block.

Delivery
As with other forms of execution of a deed, where a deed is executed by an individual trustee, it will only take effect from the time it is delivered rather than when it is dated or executed.

This requires an assessment of when a party intends to be bound, an objective question of fact to be determined by examining all the surrounding circumstances and without any presumption of an intention to be immediately bound merely by executing a deed – see Segboer v AJ Richardson Properties Pty Ltd [2012] NSWCA 253, [59]-[60] and Realm Resources Ltd v Aurora Place Investments Pty Ltd [2019] NSWSC 379, [71].

Where there is any doubt about when delivery is to take effect (including the terms of any escrow), this should be explicitly stated, preferably in the deed itself.

Electronic signatures and electronic deeds
Usually electronic signatures should not be used to execute deeds. The reasons for this are discussed in detail in the Electronic Execution section. However, eSignatures are (temporarily) permitted during the COVID-19 pandemic under some circumstances. Please refer to Can I use an eSignature to sign documents during COVID-19?

Do not pre-sign signature pages
Signature pages should never be ‘pre-signed’ and attached to a deed. Instead the whole deed should be printed, the pages securely fastened and then the deed executed.

Stamp duty
Stamp duty may be payable on the execution of a deed. Consider seeking specialist tax advice.

Disclaimer
This execution block and accompanying notes are general information and are not intended as advice on any particular matter.  They have been created to assist in-house legal counsel with some key legal and practical requirements which commonly arise in the execution of deeds and agreements. The material assumes a certain level of legal understanding. It is not intended to provide an exhaustive guide nor is it a replacement for legal advice tailored to specific circumstances.

No user should act or fail to act on the basis of any of this material.  Gilbert + Tobin expressly disclaims all and any liability to any persons whatsoever in respect of anything done in reliance, whether in whole or in part, on this material.

Trusts – company as trustee (with common seal)

Execution block
Click here to download an execution block for a company to execute a deed as trustee using its common seal in the presence of either:

  • two directors or a director and a company secretary; or
  • a sole director who is also the company secretary (in the case of a proprietary company).

Use of this execution block
This is an execution block for a company to execute a deed as a trustee using its common seal in the presence of either:

  • two directors or a director and a company secretary; or
  • a sole director, who is also the company secretary (in the case of a proprietary company).

The execution block should be used in conjunction with the important notes which follow below.

Use this block for executing deeds only
This execution block should only be used for executing deeds.

As with the execution of deeds in other cases, where a deed is executed by a company in its trustee capacity, it is best practice for the document to be expressed to be a deed in the execution block.

For executing agreements rather than deeds, please refer to the Execution of Agreements section of this app.

Execution by trustees
Consider obtaining a certified up-to-date copy of the trust deed. There is no ‘indoor management rule’ which external persons can rely on when dealing with trusts.  Anyone dealing with a purported trustee will need to ensure that the trust is properly constituted, the trustee has been properly appointed and that it has power to execute the document.

If the trustee is not being required to give warranties about its authority then consider amending the execution block by adding the words ‘and in accordance with the trust deed dated [#]’ after the reference to the Corporations Act.

Execution pursuant to the Corporations Act– two signatories or one signatory
The same considerations apply here as those raised earlier in the Execution of Deeds section of this app in the context of execution by a company in its own (non-trustee) capacity by fixing its common seal, witnessed by two signatories or the sole director and secretary of a proprietary company.  Reference should be made to that commentary if you are seeking to rely on ss 127(2) and 127(3) to allow execution of a deed by a company in its trustee capacity by fixing its common seal.

Ensure the correct people witness the fixing of the seal
Consider whether it is necessary or appropriate to undertake an ASIC search to establish the capacity of the people who are witnessing the fixing of the seal.

Do not use this execution block outside Australia or where the laws of another country may apply
This execution block has been drafted for use within Australia only, and for deeds that are subject to Australian law. If the law of the deed is that of another jurisdiction and/or the deed is to be executed outside Australia, specialist advice should be sought.

Use this execution block only for an Australian corporation
This execution block should only be used for Australian corporations which are registered under Chapter 2A of the Corporations Act. It should not be used for a foreign corporation (including a foreign corporation registered under Division 2 of Part 5B.2 of the Corporations Act.

Specialist advice should be sought in relation to the execution of deeds by foreign corporations.

Delivery
As with other forms of execution of a deed, where a deed is executed by a corporate trustee, it will only take effect from the time it is delivered rather than when it is dated or executed.

This requires an assessment of when a party intends to be bound, an objective question of fact to be determined by examining all the surrounding circumstances and without any presumption of an intention to be immediately bound merely by executing a deed – see Segboer v AJ Richardson Properties Pty Ltd [2012] NSWCA 253, [59]-[60] and Realm Resources Ltd v Aurora Place Investments Pty Ltd [2019] NSWSC 379, [71].

Where there is any doubt about when delivery is to take effect (including the terms of any escrow), this should be explicitly stated, preferably in the deed itself.

Electronic signatures and electronic deeds
Usually electronic signatures should not be used to execute deeds. The reasons for this are discussed in detail in the Electronic Execution section. However, eSignatures are (temporarily) permitted during the COVID-19 pandemic under some circumstances. Please refer to Can I use an eSignature to sign documents during COVID-19?

Do not pre-sign signature pages
Signature pages should never be ‘pre-signed’ and attached to a deed. Instead the whole deed should be printed, the pages securely fastened and then the deed executed.

Stamp duty
Stamp duty may be payable on the execution of a deed. Consider seeking specialist tax advice.

Disclaimer
This execution block and accompanying notes are general information and are not intended as advice on any particular matter.  They have been created to assist in-house legal counsel with some key legal and practical requirements which commonly arise in the execution of deeds and agreements. The material assumes a certain level of legal understanding. It is not intended to provide an exhaustive guide nor is it a replacement for legal advice tailored to specific circumstances.

No user should act or fail to act on the basis of any of this material. Gilbert + Tobin expressly disclaims all and any liability to any persons whatsoever in respect of anything done in reliance, whether in whole or in part, on this material.

Trusts – company as trustee (without common seal)

Execution block
Click here to download an execution block for a company to execute a deed as a trustee without using a common seal by the signature of either:

  • two directors or a director and a company secretary; or
  • a sole director and company secretary (in the case of a proprietary company).

Use of this execution block
This is an execution block for a company to execute a deed as a trustee using its common seal in the presence of either:

  • two directors or a director and a company secretary; or
  • a sole director and company secretary (in the case of a proprietary company).

The execution block should be used in conjunction with the important notes which follow below.

Use this block for executing deeds only
This execution block should only be used for executing deeds.

As noted earlier in the Execution of Deeds section in relation to execution by other parties, where a deed is executed by a company in its trustee capacity, it is best practice for the document to be expressed to be a deed in the execution block.

For executing agreements rather than deeds, please refer to the Execution of Agreements section of this app.

Execution by trustees
Consider obtaining a certified up-to-date copy of the trust deed. There is no ‘indoor management rule’ which external persons can rely on when dealing with trusts.  Anyone dealing with a purported trustee will need to ensure that the trust is properly constituted, the trustee has been properly appointed and that it has power to execute the document.

If the trustee is not being required to give warranties about its authority then consider amending the execution block by adding the words ‘and in accordance with the trust deed dated [#]’ after the reference to the Corporations Act.

Execution pursuant to the Corporations Act – two signatories or one signatory
The same considerations apply here as those raised earlier in the Execution of Deeds section of this app in the context of execution by a company in its own (non-trustee) capacity by the signature of two directors, a director and company secretary or a sole director and secretary of a proprietary company.  Reference should be made to that commentary if you are seeking to rely on ss 127(1) and 127(3) to allow execution of a deed by a company in its trustee capacity by the signature of those persons.

‘Split executions’ should be avoided
As noted in the case of execution by a company in its own (non-trustee) capacity, it is desirable for ‘split executions’ involving two officers signing different physical copies of the same deed to be avoided to ensure compliance with ss 127(1) and 127(3) of the Corporations Act.

If split execution is unavoidable, the parties should discuss at the earliest opportunity a position which is acceptable to all concerned. At the least, a wide counterparts clause should be included which states that signatures on behalf of a party may be on different counterparts. However, this provides no guarantee that split execution will be effective.

An ‘authorised signatory’ cannot execute a deed for a company
As noted earlier in the Execution of Deeds section in relation to the execution of a deed by a company in its own (non-trustee) capacity, the better view is that an authorised signatory cannot execute a deed (as opposed to an ordinary agreement) for a company as its agent if the signatory has only been appointed by board resolution, as distinct from a formal power of attorney expressed as a deed.  It is unlikely that s 126 (1) of the Corporations Act can be used to by-pass the ordinary execution requirements for deeds as it refers only to contracts and not deeds and the  formal requirements for deeds are expressly preserved by s 126(2).

As a result, if a company wishes  to execute a deed by signature and without fixing its common seal, to ensure validity of the deed it either needs to:

  • execute under s 127 of the Corporations Act by using an execution block such as this one; or
  • formally appoint an attorney to execute the deed under a power of attorney (see the execution block and notes for a deed executed for a company by an attorney earlier in the Execution of Deeds section).

Ensure the correct people sign the deed
Consider whether it is necessary or appropriate to undertake an ASIC search to establish the capacity of the people who are signing the deed.

Do not use this execution block outside Australia or where the laws of another country may apply
This execution block has been drafted for use within Australia only, and for deeds that are subject to Australian law. If the law of the deed is that of another jurisdiction and/or the deed is to be executed outside Australia, specialist advice should be sought.

Use this execution block only for an Australian corporation
This execution block should only be used for Australian corporations which are registered under Chapter 2A of the Corporations Act. It should not be used for a foreign corporation (including a foreign corporation registered under Division 2 of Part 5B.2 of the Corporations Act.

Specialist advice should be sought in relation to the execution of deeds by foreign corporations.

Delivery
As noted, where a deed is executed by a corporate trustee, it will only take effect from the time it is delivered rather than when it is dated or executed, a matter requiring assessment of when a party intends to be bound based on all the objective circumstances.

Where there is any doubt about when delivery is to take effect (including the terms of any escrow), this should be explicitly stated, preferably in the deed itself.

Electronic signatures and electronic deeds
Never use electronic signatures to execute deeds. The reasons for this are discussed in detail in the Electronic Execution section.

Do not pre-sign signature pages
Signature pages should never be ‘pre-signed’ and attached to a deed. Instead the whole deed should be printed, the pages securely fastened and then the deed executed.

Stamp duty
Stamp duty may be payable on the execution of a deed. Consider seeking specialist tax advice.

Disclaimer
This execution block and accompanying notes are general information and are not intended as advice on any particular matter.  They have been created to assist in-house legal counsel with some key legal and practical requirements which commonly arise in the execution of deeds and agreements. The material assumes a certain level of legal understanding. It is not intended to provide an exhaustive guide nor is it a replacement for legal advice tailored to specific circumstances.

No user should act or fail to act on the basis of any of this material. Gilbert + Tobin expressly disclaims all and any liability to any persons whatsoever in respect of anything done in reliance, whether in whole or in part, on this material.

Execution of agreements
Individuals

Execution block
Click here to download an execution block for an agreement to be executed by an individual.

Use of this execution block
This is an execution block for an individual to execute an agreement. It should be used in conjunction with the important notes which follow below.

Use this block for executing agreements only
This execution block should only be used for executing agreements. The document used in conjunction with this execution block should be expressed throughout to be an agreement rather than a deed. For executing deeds instead, please refer to the Execution of Deeds section of this app.

Do not use this execution block outside Australia or where the laws of another country may apply
This execution block has been drafted for use within Australia only, and for agreements that are subject to Australian law. If the law of the agreement is that of another jurisdiction and/or the agreement is to be executed outside Australia, specialist advice should be sought.

Witnessing is for evidentiary purposes
This execution block provides for the individual who is executing the agreement to have their signature witnessed. This requirement has been included for evidentiary purposes. It is not necessary as a matter of law.

The witness must be present when the agreement is signed. They should not be a party to the agreement. Ideally a witness should not be a representative, relative or employee of a party to the agreement.

There are specific requirements that must be complied with for a person to act as a witness for a real property transaction. Consider obtaining specialist advice in these circumstances.

Electronic signatures and electronic agreements
This execution block is not generally suitable for electronically executed agreements as the use of a witness for evidentiary purposes is not easily translatable to the electronic environment.  This is discussed in further detail in the Electronic Execution section. However, eSignatures are (temporarily) permitted during the COVID-19 pandemic under some circumstances. Please refer to Can I use an eSignature to sign documents during COVID-19?

Do not pre-sign signature pages
Signature pages should not be ‘pre-signed’ and attached to an agreement. Instead the whole agreement should be printed, the pages securely fastened and then the agreement executed.

Disclaimer
This execution block and accompanying explanatory notes are general information and are not intended as advice on any particular matter. They have been created to assist in-house legal counsel with some key legal and practical requirements which commonly arise in the execution of deeds and agreements. The material assumes a certain level of legal understanding. It is not intended to provide an exhaustive guide nor is it a replacement for legal advice tailored to specific circumstances.

No user should act or fail to act on the basis of any of this material. Gilbert + Tobin expressly disclaims all and any liability to any persons whatsoever in respect of anything done in reliance, whether in whole or in part, on this material.

Individuals as attorneys

Execution block
Click here to download an execution block for an agreement to be executed by an individual as attorney.

Use of this execution block
This is an execution block for an individual to execute an agreement as an attorney. The execution block can be used for an individual executing an agreement as attorney for either an individual or a company. It should be used in conjunction with the important notes which follow below.

Use this block for executing agreements only
This execution block should only be used for executing agreements. The document used in conjunction with this execution block should be expressed throughout to be an agreement rather than a deed. For executing deeds instead, please refer to

Do not use this execution block outside Australia or where the laws of another country may apply
This execution block has been drafted for use within Australia only, and for agreements that are subject to Australian law. If the law of the agreement is that of another jurisdiction and/or the agreement is to be executed outside Australia, specialist advice should be sought.

Ensure the person signing the agreement is authorised to do so
You should review the authorising power of attorney to ensure that it has been validly executed and that the attorney who will be signing the agreement has authority under the authorising power of attorney to do so.

Attorney signs their own name
This execution block provides for the attorney to sign their own name. An attorney can sign in their own name if either:

  • the power of attorney expressly permits them to do so; and/or
  • the power of attorney is governed by the law of a jurisdiction which has a statutory provision allowing the attorney to sign in their own name (currently NSW, NT (unless a contrary intention appears in the power of attorney), Qld, Tas, Vic and WA).

Outside these circumstances, the attorney may not be able to sign in their own name and specialist advice should be sought.

Statutory assumptions of due execution where attorney signs for company
Where a company executes an agreement by an attorney, the important presumptions of due execution under ss 128-129 of the Corporations Act 2001 (Cth) are not available in relation to the agreement itself as the execution is not in accordance with ss 127(1) or 127(2).  However, they will be available in relation to the execution of the underlying power of attorney if it has been executed under s 127 (by the signature of two directors, a director and company secretary or the sole director and company secretary of a proprietary company or otherwise by the affixing of the company’s common seal witnessed by those persons).

Sections 127-129 of the Corporations Act are discussed in further detail in the Execution of Deeds section, as well as in the balance of this Execution of Agreements section.

Registration of powers of attorney
There is a statutory requirement in most jurisdictions that any power of attorney authorising dealings with land must be registered to give validity to those dealings. The only exceptions to this general rule are Western Australia (although a power of attorney may be deposited with the Land Information Authority) and Victoria (where no power of attorney is required to be registered although a certified copy of the power of attorney must be lodged with the Land Titles Office).

In Tasmania, all powers of attorney are required to be registered. In the ACT, there are additional registration requirements for powers of attorney which are created in respect of conveyances or deeds.

The registration requirements in the various jurisdictions (including the precise circumstances in which registration is required) fall outside of the scope of this app. If registration of the power of attorney may be required, specialist advice should be sought. This execution clause may not be appropriate where registration is required.

As a general rule, if an instrument is executed under an invalid power of attorney or a power of attorney that post-dates the signed instrument, registering the power of attorney will not validate the instrument.

Witnessing is for evidentiary purposes
This execution block provides for the attorney who is executing the agreement to have their signature witnessed. This requirement has been included for evidentiary purposes.  It is not necessary as a matter of law.

The witness must be present when the agreement is signed. They should not be a party to the agreement.  Ideally a witness should not be a representative, relative or employee of a party to the agreement.

There are specific requirements that must be complied with for a person to act as a witness for a real property transaction. Consider obtaining specialist advice in these circumstances.

Electronic signatures and electronic agreements
This execution block is not generally suitable for electronically executed agreements as the use of a witness for evidentiary purposes is not easily translatable to the electronic environment. However, eSignatures are (temporarily) permitted during the COVID-19 pandemic under some circumstances. Please refer to Can I use an eSignature to sign documents during COVID-19?

Do not pre-sign signature pages
Signature pages should not be ‘pre-signed’ and attached to an agreement. Instead the whole agreement should be printed, the pages securely fastened and then the agreement executed.

Disclaimer
This execution block and accompanying explanatory notes are general information and are not intended as advice on any particular matter.  They have been created to assist in-house legal counsel with some key legal and practical requirements which commonly arise in the execution of deeds and agreements. The material assumes a certain level of legal understanding. It is not intended to provide an exhaustive guide nor is it a replacement for legal advice tailored to specific circumstances.

No user should act or fail to act on the basis of any of this material.  Gilbert + Tobin expressly disclaims all and any liability to any persons whatsoever in respect of anything done in reliance, whether in whole or in part, on this material.

General partnerships

Execution block
Click here to download an execution block for an agreement to be executed on behalf of a general partnership.

Use of this execution block
This is an execution block for an individual partner to execute an agreement on behalf of a general partnership. It should be used in conjunction with the important notes which follow below.

Use this block for executing agreements only
This execution block should only be used for executing agreements. The document used in conjunction with this execution block should be expressed throughout to be an agreement rather than a deed. For executing deeds instead, please refer to the Execution of Deeds section of this app.

Do not use this execution block outside Australia or where the laws of another country may apply.

This execution block has been drafted for use within Australia only, and for agreements that are subject to Australian law. If the law of the agreement is that of another jurisdiction and/or the agreement is to be executed outside Australia, specialist advice should be sought.

Partner executing on behalf of partnership
Legislation in each Australian jurisdiction provides that a partner can bind the entire partnership by executing in the partnership’s name an instrument relating to the business of the partnership.

Ensure the person signing the agreement is authorised to do so
You should review the partnership agreement (if there is one) to ensure that there are no restrictions on the execution of agreements by partners on behalf of the partnership (e.g. providing that agreements over a certain monetary sum can only be signed by two or more partners).

Witnessing is for evidentiary purposes
This execution block provides for the partner who is executing the agreement to have their signature witnessed. This requirement has been included for evidentiary purposes.  It is not necessary as a matter of law.

The witness must be present when the agreement is signed. They should not be a party to the agreement.  Ideally a witness should not be a representative, relative or employee of a party to the agreement.

There are specific requirements that must be complied with for a person to act as a witness for a real property transaction. Consider obtaining specialist advice in these circumstances.

Electronic signatures and electronic agreements
This execution block is not generally suitable for electronically executed agreements as the use of a witness for evidentiary purposes is not easily translatable to the electronic environment. However, eSignatures are (temporarily) permitted during the COVID-19 pandemic under some circumstances. Please refer to Can I use an eSignature to sign documents during COVID-19?

Do not pre-sign signature pages
Signature pages should not be ‘pre-signed’ and attached to an agreement. Instead the whole agreement should be printed, the pages securely fastened and then the agreement executed.

Disclaimer
This execution block and accompanying explanatory notes are general information and are not intended as advice on any particular matter. They have been created to assist in-house legal counsel with some key legal and practical requirements which commonly arise in the execution of deeds and agreements. The material assumes a certain level of legal understanding. It is not intended to provide an exhaustive guide nor is it a replacement for legal advice tailored to specific circumstances.

No user should act or fail to act on the basis of any of this material. Gilbert + Tobin expressly disclaims all and any liability to any persons whatsoever in respect of anything done in reliance, whether in whole or in part, on this material.

Company (with common seal)

Execution block
Download here an execution block for:

  • an agreement to be executed by a company under its common seal – two signatories;
  • an agreement to be executed by a company under its common seal – one signatory.

Use of this execution block
This is an execution block for a company to execute an agreement using its common seal in the presence of either:

  • two directors or a director and a company secretary; or
  • a sole director and company secretary (in the case of a proprietary company).

The execution block should be used in conjunction with the important notes which follow below.

Use this block for executing agreements only
This execution block should only be used for executing agreements. The document used in conjunction with this execution block should be expressed throughout to be an agreement rather than a deed. For executing deeds instead, please refer to the Execution of Deeds section of this app.

Execution pursuant to the Corporations Act 2001 (Cth) – two signatories
This execution block provides for execution pursuant to ss 127(2)(a) and 127(2)(b) of the Corporations Act. According to those provisions, a company can execute a document as an agreement (as distinct from a deed) if the company’s seal is fixed to the agreement and the fixing of the seal is witnessed by either:

  • two directors; or
  • a director and a company secretary.

The requirements of ss 127(2)(a) and 127(2)(b) will not be satisfied if only one person witnesses the fixing of the company’s seal, even if that person is both a director and company secretary. Further, those provisions do not permit two company secretaries to witness the fixing of the company’s common seal if neither is a director – rather, at least one witness must be, or must also be, a director.

Execution under ss 127(2)(a) and 127(2)(b) is possible irrespective of what is contained in a company’s constitution.

Significantly, if it merely appears that execution has taken place in compliance with those provisions, the presumptions of regular execution in ss 128 and 129(6) of the Corporations Act will apply (unless a counterparty knows or suspects the agreement was not properly executed).  As noted in the Execution of Deeds section, these presumptions are of great value to a counterparty and in practice result in a counterparty insisting that an agreement is executed by a company under ss 127(2)(a) and 127(2)(b), or otherwise under s 127(1) by the signature of two directors, a director and company secretary or the sole director and company secretary of a proprietary company (discussed later in this Execution of Agreements section).

Execution pursuant to the Corporations Act– one signatory
This execution block provides for execution pursuant to s 127(2)(c) of the Corporations Act. That section permits a proprietary company (but not a public company) to execute a document as an agreement if the company’s seal is fixed to the document and the fixing of the seal is witnessed by the sole director and secretary of the company.  This method of execution can only be used by proprietary companies because public companies must have a minimum of three directors under s 201A(2) of the Corporations Act.

The requirements of s127(2)(c) will not be satisfied if the sole director of a proprietary company executes a deed in circumstances where the company has not appointed any company secretary (this is permitted by s 204A(1) of the Corporations Act). In that event, the only way to ensure the deed is properly executed under s 127(2)(c) is for the director to appoint himself/herself as the company’s sole secretary as well.

Again, a proprietary company can execute an agreement in accordance with s 127(2)(c) even if that is not expressly permitted by its constitution and if it appears that manner of execution has been used, the statutory presumptions of regular execution under ss 128 and 129(6) referred to above will be invoked.

Ensure the correct people witness the fixing of the seal
Consider whether it is necessary or appropriate to undertake an ASIC search to establish the capacity of the people who are witnessing the fixing of the seal.

Do not use this execution block outside Australia or where the laws of another country may apply
This execution block has been drafted for use within Australia only, and for agreements that are subject to Australian law. If the law of the agreement is that of another jurisdiction and/or the agreement is to be executed outside Australia, specialist advice should be sought.

Use this execution block only for an Australian corporation
This execution block should only be used for Australian corporations which are registered under Chapter 2A of the Corporations Act. It should not be used for a foreign corporation (including a foreign corporation registered under Division 2 of Part 5B.2 of the Corporations Act.

Specialist advice should be sought in relation to the execution of agreements by foreign corporations.

Electronic signatures and electronic agreements
This execution block should not be used for electronically executed agreements. As noted in the Electronic Execution section, Gilbert + Tobin’s position is that both deeds and agreements should not be executed electronically by companies. Rather, to ensure the validity of the deed or agreement, best practice continues to be for the deed or agreement to exist in physical form and for a wet signature to be used.

Do not pre-sign signature pages
Signature pages should never be ‘pre-signed’ and attached to an agreement. Instead the whole agreement should be printed, the pages securely fastened and then the agreement executed.

Disclaimer
This execution block and accompanying notes are general information and are not intended as advice on any particular matter.  They have been created to assist in-house legal counsel with some key legal and practical requirements which commonly arise in the execution of deeds and agreements. The material assumes a certain level of legal understanding. It is not intended to provide an exhaustive guide nor is it a replacement for legal advice tailored to specific circumstances.

No user should act or fail to act on the basis of any of this material.  Gilbert + Tobin expressly disclaims all and any liability to any persons whatsoever in respect of anything done in reliance, whether in whole or in part, on this material.

Company (without common seal)

Execution block
Download an execution block for:

Use of this execution block
This is an execution block for a company to execute an agreement without using a common seal by the signature of either:

  • two directors or a director and a company secretary; or
  • a sole director and company secretary (in the case of a proprietary company).

The execution block should be used in conjunction with the important notes which follow below.

Use this block for executing agreements only
This execution block should only be used for executing agreements. The document used in conjunction with this execution block should be expressed throughout to be an agreement rather than a deed. For executing deeds instead, please refer to the Execution of Deeds section of this app.

Execution pursuant to the Corporations Act 2001 (Cth) – two signatories
This execution block provides for execution pursuant to ss 127(1)(a) and 127(1)(b) of the Corporations Act. That section provides that a company can execute a document as an agreement without using a common seal if the document is signed by either:

  • two directors; or
  • a director and a company secretary.

As with the execution of an agreement by witnessing the fixing of a company’s common seal (see the earlier discussion in this Execution of Agreements section, execution of an agreement by way of signature under ss 127(1)(a) and 127(1)(b):

  • requires the signature of two people (not a single person who is both a director and company secretary) and is not satisfied by the signature of two company secretaries;
  • can occur notwithstanding anything contained in a company’s constitution; and
  • invokes the statutory presumptions of regular execution in ss 128 and 129(6) of the Corporations Act when it appears the requirements have been complied with (absent a counterparty’s knowledge or suspicion to the contrary).

Execution pursuant to the Corporations Act – one signatory
This execution block provides for execution pursuant to s 127(1)(c) of the Corporations Act. According to that section, a proprietary company (but not a public company) can execute a document as an agreement without using a common seal if the document is signed by the sole director and secretary of the company.    A public company cannot rely on s 127(1)(c) because it must have a minimum of three directors under s 201A(2).

As is the case in relation to execution under s 127(2)(c) by witnessing the affixation of a company’s common seal, execution by way of signature under s 127(1)(c):

  • requires a person to be specifically appointed as both a director and company secretary of a proprietary company;
  • applies notwithstanding anything contained in a company’s constitution; and
  • invokes the presumptions of regular execution in ss 128 and 129(6) of the Corporations Act, provided a counterparty does not know or suspect anything to the contrary.

‘Split executions’ should be avoided
As noted in the Execution of Deeds section of this app, a ‘split execution’ refers to two officers signing different physical copies of the same agreement.

The better view is that split executions should be avoided to ensure compliance with s 127(1) of the Corporations Act.
If a split execution is unavoidable, the parties should discuss at the earliest opportunity a position which is acceptable to all concerned. At the least, a wide counterparts clause should be included which states that signatures on behalf of a party may be on different counterparts. However, this provides no guarantee that split execution will be effective.

Ensure the correct people sign the agreement
Consider whether it is necessary or appropriate to undertake an ASIC search to establish the capacity of the people who are signing the agreement.

Do not use this execution block outside Australia or where the laws of another country may apply
This execution block has been drafted for use within Australia only, and for agreements that are subject to Australian law. If the law of the agreement is that of another jurisdiction and/or the agreement is to be executed outside Australia, specialist advice should be sought.

Use this execution block only for an Australian corporation
This execution block should only be used for Australian corporations which are registered under Chapter 2A of the Corporations Act. It should not be used for a foreign corporation (including a foreign corporation registered under Division 2 of Part 5B.2 of the Corporations Act.

Specialist advice should be sought in relation to the execution of agreements by foreign corporations.

Electronic signatures and electronic agreements
This execution block is not generally suitable for electronically executed agreements as the use of a witness for evidentiary purposes is not easily translatable to the electronic environment.  This is discussed in further detail in the Electronic Execution section of this app. However, eSignatures are (temporarily) permitted during the COVID-19 pandemic under some circumstances.  Please refer to Can I use an eSignature to sign documents during COVID-19?

Do not pre-sign signature pages
Signature pages should never be ‘pre-signed’ and attached to an agreement. Instead the whole agreement should be printed, the pages securely fastened and then the agreement executed.

Disclaimer
This execution block and accompanying explanatory notes are general information and are not intended as advice on any particular matter.  They have been created to assist in-house legal counsel with some key legal and practical requirements which commonly arise in the execution of deeds and agreements. The material assumes a certain level of legal understanding. It is not intended to provide an exhaustive guide nor is it a replacement for legal advice tailored to specific circumstances.

No user should act or fail to act on the basis of any of this material. Gilbert + Tobin expressly disclaims all and any liability to any persons whatsoever in respect of anything done in reliance, whether in whole or in part, on this material.

Company by authorised signatory

Execution block
Click here to download an execution block for an agreement to be executed by a company without using a common seal by the signature of its authorised signatory.

Use of this execution block
This is an execution block for a company to execute an agreement without using a common seal by the signature of its authorised signatory. The execution block should be used in conjunction with the important notes which follow below.

Use this block for executing agreements only
This execution block should only be used for executing agreements. The document used in conjunction with this execution block should be expressed throughout to be an agreement rather than a deed. For executing deeds instead, please refer to the Execution of Deeds section of this app.

Execution pursuant to the Corporations Act 2001 (Cth)
This execution block provides for execution pursuant to s 126 of the Corporations Act. That section provides that a company can execute a document as an agreement without using a common seal if the power to do so is exercised by an individual acting with the company’s express or implied authority and on behalf of the company.

While, as discussed in the Execution of Deeds section, it was held in Torrens Redevelopment & Research Pty Ltd v Oakworth Developments Pty Ltd [2008] NSWSC 1096 that a board resolution alone is not sufficient to confer authority on an agent to execute a deed on behalf of a company, a resolution of the board is capable of conferring express authority on a person to execute an agreement on behalf of the company for the purpose of s 126.  Any agreement so executed by the agent would then be valid.

However, in this situation, the counterparty to the agreement will generally require proof that the board resolution has been passed because the statutory presumptions as to proper execution of an agreement by a person with authority (contained in s 129 of the Corporations Act) do not apply in relation to execution under s 126.  In practice, a counterparty may also simply insist that execution takes place under s 127 rather than s 126.

This app does not deal with the situation where the authorised signatory’s power is or may be implied. Specialist advice should be sought in that instance.

Do not use this execution block outside Australia or where the laws of another country may apply
This execution block has been drafted for use within Australia only, and for agreements that are subject to Australian law. If the law of the agreement is that of another jurisdiction and/or the agreement is to be executed outside Australia, specialist advice should be sought.

Use this execution block only for an Australian corporation
This execution block should only be used for Australian corporations which are registered under Chapter 2A of the Corporations Act. It should not be used for a foreign corporation (including a foreign corporation registered under Division 2 of Part 5B.2 of the Corporations Act.

Specialist advice should be sought in relation to the execution of agreements by foreign corporations.

Witnessing is for evidentiary purposes
This execution block provides for the authorised signatory who is executing the agreement to have their signature witnessed. This requirement has been included for evidentiary purposes.  It is not necessary as a matter of law.

The witness must be present when the agreement is signed. They should not be a party to the agreement.  Ideally a witness should not be a representative or employee of a party to the agreement.

There are specific requirements that must be complied with for a person to act as a witness for a real property transaction. Consider obtaining specialist advice in these circumstances.

Electronic signatures and electronic agreements
This execution block is not generally suitable for electronically executed agreements as the use of a witness for evidentiary purposes is not easily translatable to the electronic environment. However, eSignatures are (temporarily) permitted during the COVID-19 pandemic under some circumstances. Please refer to Can I use an eSignature to sign documents during COVID-19?

Do not pre-sign signature pages
Signature pages should not be ‘pre-signed’ and attached to an agreement. Instead the whole agreement should be printed, the pages securely fastened and then the agreement executed.

Disclaimer
This execution block and accompanying notes are general information and are not intended as advice on any particular matter.  They have been created to assist in-house legal counsel with some key legal and practical requirements which commonly arise in the execution of deeds and agreements. The material assumes a certain level of legal understanding. It is not intended to provide an exhaustive guide nor is it a replacement for legal advice tailored to specific circumstances.

No user should act or fail to act on the basis of any of this material.  Gilbert + Tobin expressly disclaims all and any liability to any persons whatsoever in respect of anything done in reliance, whether in whole or in part, on this material.

Trusts – individual as trustee

Execution block
Click here to download an execution block for an agreement to be executed by an individual as trustee.

Use of this execution block
This is an execution block for an individual to execute an agreement as a trustee. It should be used in conjunction with the important notes which follow below.

Execution by trustees
Consider obtaining a certified up-to-date copy of the trust deed. There is no ‘indoor management rule’ which external persons can rely on when dealing with trusts.  Anyone dealing with a purported trustee will need to ensure that the trust is properly constituted, the trustee has been properly appointed and that they have power to execute the document.

If the trustee is not being required to give warranties about their authority then consider amending the execution block by adding the words ‘and in accordance with the trust deed dated [#]’ after inserting the name of the trust.

Use this block for executing agreements only
This execution block should only be used for executing agreements. The document used in conjunction with this execution block should be expressed throughout to be an agreement rather than a deed. For executing deeds instead, please refer to the Execution of Deeds section of this app.

Do not use this execution block outside Australia or where the laws of another country may apply
This execution block has been drafted for use within Australia only, and for agreements that are subject to Australian law. If the law of the agreement is that of another jurisdiction and/or the agreement is to be executed outside Australia, specialist advice should be sought.

Witnessing is for evidentiary purposes
This execution block provides for the individual who is executing the agreement as trustee to have their signature witnessed. This requirement has been included for evidentiary purposes.  It is not necessary as a matter of law.

The witness must be present when the agreement is signed. They should not be a party to the agreement. They should also not be a beneficiary of the trust.  Ideally a witness should not be a representative, relative or employee of a party to the agreement.

There are specific requirements that must be complied with for a person to act as a witness for a real property transaction. Consider obtaining specialist advice in these circumstances.

Electronic signatures and electronic agreements
This execution block should not be used for electronically executed agreements. However, eSignatures are (temporarily) permitted during the COVID-19 pandemic under some circumstances. Please refer to Can I use an eSignature to sign documents during COVID-19?

Do not pre-sign signature pages
Signature pages should not be ‘pre-signed’ and attached to an agreement. Instead the whole agreement should be printed, the pages securely fastened and then the agreement executed.

Disclaimer
This execution block and accompanying notes are general information and are not intended as advice on any particular matter.  They have been created to assist in-house legal counsel with some key legal and practical requirements which commonly arise in the execution of deeds and agreements. The material assumes a certain level of legal understanding. It is not intended to provide an exhaustive guide nor is it a replacement for legal advice tailored to specific circumstances.

No user should act or fail to act on the basis of any of this material.  Gilbert + Tobin expressly disclaims all and any liability to any persons whatsoever in respect of anything done in reliance, whether in whole or in part, on this material.

Trusts – company as trustee (with common seal)

Execution block
Download here an execution block for a company to execute an agreement as a trustee using its common seal in the presence of either:

  • two directors or a director and a company secretary; or
  • a sole director who is also the company secretary (in the case of a proprietary company).

Use of this execution block
This is an execution block for a company to execute an agreement as a trustee using its common seal in the presence of either:

  • two directors or a director and a company secretary; or
  • a sole director, who is also the company secretary (in the case of a proprietary company).

The execution block should be used in conjunction with the important notes which follow below.

Use this block for executing agreements only
This execution block should only be used for executing agreements. The document used in conjunction with this execution block should be expressed throughout to be an agreement rather than a deed. For executing deeds instead, please refer to the Execution of Deeds section of this app.

Execution by trustees
Consider obtaining a certified up-to-date copy of the trust deed. There is no ‘indoor management rule’ which external persons can rely on when dealing with trusts.  Anyone dealing with a purported trustee will need to ensure that the trust is properly constituted, the trustee has been properly appointed and that it has power to execute the document.

If the trustee is not being required to give warranties about its authority then consider amending the execution block by adding the words ‘and in accordance with the trust deed dated [#]’ after the reference to the Corporations Act.

Execution pursuant to the Corporations Act 2001 (Cth) – two signatories or one signatory
The same considerations apply here as those raised earlier in the Execution of Agreements section of this app in relation to execution by a company in its own (non-trustee) capacity by fixing its common seal, witnessed by two signatories or the sole director and secretary of a proprietary company.  Reference should be made to that commentary if you are seeking to rely on s 127(2) of the Corporations Act to allow an agreement to be executed by a company in its trustee capacity by fixing its common seal.

Ensure the correct people witness the fixing of the seal
Consider whether it is necessary or appropriate to undertake an ASIC search to establish the capacity of the people who are witnessing the fixing of the seal.

Do not use this execution block outside Australia or where the laws of another country may apply
This execution block has been drafted for use within Australia only, and for agreements that are subject to Australian law. If the law of the agreement is that of another jurisdiction and/or the agreement is to be executed outside Australia, specialist advice should be sought.

Use this execution block only for an Australian corporation
This execution block should only be used for Australian corporations which are registered under Chapter 2A of the Corporations Act. It should not be used for a foreign corporation (including a foreign corporation registered under Division 2 of Part 5B.2 of the Corporations Act.

Specialist advice should be sought in relation to the execution of agreements by foreign corporations.

Electronic signatures and electronic agreements
This execution block should not be used for electronically executed agreements. However, eSignatures are (temporarily) permitted during the COVID-19 pandemic under some circumstances. Please refer to Can I use an eSignature to sign documents during COVID-19?

Do not pre-sign signature pages
Signature pages should never be ‘pre-signed’ and attached to an agreement. Instead the whole agreement should be printed, the pages securely fastened and then the agreement executed.

Disclaimer
This execution block and accompanying notes are general information and are not intended as advice on any particular matter.  They have been created to assist in-house legal counsel with some key legal and practical requirements which commonly arise in the execution of deeds and agreements. The material assumes a certain level of legal understanding. It is not intended to provide an exhaustive guide nor is it a replacement for legal advice tailored to specific circumstances.

No user should act or fail to act on the basis of any of this material.  Gilbert + Tobin expressly disclaims all and any liability to any persons whatsoever in respect of anything done in reliance, whether in whole or in part, on this material.

Trusts – company as trustee (without common seal)

Execution block
Download here an execution block for a company to execute an agreement as a trustee without using its common seal by the signature of:

  • two directors or a director and a company secretary; or
  • a sole director and company secretary (in the case of a proprietary company).

Use of this execution block
This is an execution block for a company to execute an agreement as a trustee without using its common seal in the presence of either:

  • two directors or a director and a company secretary; or
  • a sole director company secretary (in the case of a proprietary company).

The execution block should be used in conjunction with the important notes which follow below.

Use this block for executing agreements only
This execution block should only be used for executing agreements. The document used in conjunction with this execution block should be expressed throughout to be an agreement rather than a deed. For executing deeds instead, please refer to the Execution of Deeds section of this app.

Execution by trustees
Consider obtaining a certified up-to-date copy of the trust deed. There is no ‘indoor management rule’ which external persons can rely on when dealing with trusts.  Anyone dealing with a purported trustee will need to ensure that the trust is properly constituted, the trustee has been properly appointed and that it has power to execute the document.

If the trustee is not being required to give warranties about its authority then consider amending the execution block by adding the words ‘and in accordance with the trust deed dated [#]’ after the reference to the Corporations Act.

Execution pursuant to the Corporations Act 2001 (Cth) – two signatories or one signatory
The same considerations apply here as those raised earlier in the Execution of Agreements section in the context of execution by a company in its own (non-trustee) capacity by the signature of two directors, a director and company secretary or the sole director and secretary of a proprietary company.  Reference should be made to that commentary if you are seeking to rely on s 127(1) of the Corporations Act to allow execution of an agreement by a company in its trustee capacity by the signature of those persons.

‘Split executions’ should be avoided
As noted in the case of execution by a company in its own (non-trustee) capacity, it is desirable to avoid ‘split executions’ involving two officers signing different physical copies of the same agreement to ensure compliance with s 127(1) of the Corporations Act

If split execution is the only available option, the parties should discuss at the earliest opportunity a position which is acceptable to all concerned. At the least, a wide counterparts clause should be included which states that signatures on behalf of a party may be on different counterparts. However, this provides no guarantee that split execution will be effective.

Ensure the correct people sign the agreement
Consider whether it is necessary or appropriate to undertake an ASIC search to establish the capacity of the people who are signing the agreement.

Do not use this execution block outside Australia or where the laws of another country may apply
This execution block has been drafted for use within Australia only, and for agreements that are subject to Australian law. If the law of the agreement is that of another jurisdiction and/or the agreement is to be executed outside Australia, specialist advice should be sought.

Use this execution block only for an Australian corporation
This execution block should only be used for Australian corporations which are registered under Chapter 2A of the Corporations Act. It should not be used for a foreign corporation (including a foreign corporation registered under Division 2 of Part 5B.2 of the Corporations Act.

Specialist advice should be sought in relation to the execution of agreements by foreign corporations.

Electronic signatures and electronic agreements
This execution block should not be used for electronically executed agreements. However, eSignatures are (temporarily) permitted during the COVID-19 pandemic under some circumstances.  Please refer to Can I use an eSignature to sign documents during COVID-19?

Do not pre-sign signature pages
Signature pages should never be ‘pre-signed’ and attached to an agreement. Instead the whole agreement should be printed, the pages securely fastened and then the agreement executed.

Disclaimer
This execution block and accompanying notes are general information and are not intended as advice on any particular matter.  They have been created to assist in-house legal counsel with some key legal and practical requirements which commonly arise in the execution of deeds and agreements. The material assumes a certain level of legal understanding. It is not intended to provide an exhaustive guide nor is it a replacement for legal advice tailored to specific circumstances.

No user should act or fail to act on the basis of any of this material. Gilbert + Tobin expressly disclaims all and any liability to any persons whatsoever in respect of anything done in reliance, whether in whole or in part, on this material.

More information on execution of documents

For more information on execution of documents, contact:

Deborah Johns
Partner
djohns@gtlaw.com.au
+61 2 9263 4120
+61 410 540 978
Sydney

narushima-hiroshi-2010-bw

Hiroshi Narushima
Partner
hnarushima@gtlaw.com.au
+61 2 9263 4188
+61 410 541 779
Sydney