Guide to Document Execution and Witnessing

Imagine losing a game-changing investment or having a vital contract rendered worthless because of a simple signing error. In 2019, a technology startup nearly lost a $5 million funding round when investors discovered irregularities in their document execution. Another company saw a $3 million partnership agreement collapse due to improper witnessing.

These are not rare occurrences. They are wake-up calls for every business owner.

Why Document Execution Matters

Proper document execution is your business's legal shield. It:

•    Protects your agreements from legal challenges

•    Ensures contracts are legally binding

•    Prevents potentially catastrophic financial losses

•    Builds trust with investors, partners, and stakeholders

Agreements vs. Deeds

Agreements: Simple contracts enforceable with consideration (exchange of something of value). Shorter limitation period (typically 6 years).

Deeds: Formal agreements enforceable without consideration. Longer limitation period (12-15 years). Used when formality is desired or no consideration exists.

Parties commonly use deeds when they wish to be bound even though no consideration is provided (or if it is unclear whether consideration has been provided) or if a longer limitation period is sought.

Specific Requirements for Deeds: Must be in writing, sealed (deemed sealed if described as a deed and witnessed), and delivered (intention to be bound).

The Basics

Who Can Be a Witness?

Essential Requirements:

•    Over 18 years old

•    Of sound mind

•    An independent third party

•    No financial or personal interest in the document

What Does a Witness Do?

A witness:

•    Confirms the identity of the signatory

•    Verifies the signature was made voluntarily

•    Provides independent verification of the signing process

Remote Witnessing and Electronic Signing

General Principles of Electronic Signing:

1. Identity Verification: The electronic signature must reliably identify the signatory and their intention to sign.

2. Integrity of Document: The signing method must ensure the document’s integrity, i.e., that it has not been altered after signing.

3. Consent: Parties must consent to using an electronic signature.

Remote Witnessing Framework

Remote witnessing allows a witness to observe the signing of a document via audio-visual link (e.g., Zoom or Microsoft Teams). However, the process must comply with the laws governing witnessing in the relevant jurisdiction, as outlined below.

JURISDICTION	TYPE OF DEEDS THAT CAN BE SIGNED ELECTRONICALLY	WITNESSING REQUIREMENTS AND REMOTE WITNESSING PROVISIONS
QLD	Agreements, deeds, powers of attorney, and statutory declarations	Remote witnessing of statutory declarations and affidavits is permitted by audio-visual link by a “special witness”. Deeds signed electronically by an individual do not need to be witnessed, but may be witnessed if desired.
WA	No specific legislation regarding electronic signing of deeds	Remote witnessing measures expired on 31 December 2022. Prior to this date, certain documents, including affidavits and statutory declarations, could be witnessed remotely by audio-visual link.
NSW	Agreements, deeds, powers of attorney, and statutory declarations	Remote witnessing is allowed by audio-visual link for certain documents, including agreements, deeds, powers of attorney, and statutory declarations. Electronic signatures on deeds are permitted for both individuals and corporations.
VIC	Deeds, mortgages, statutory declarations, and powers of attorney	Remote witnessing of certain documents, including deeds, mortgages, statutory declarations, and powers of attorney, is allowed via audio-visual link. Deeds in Victoria are not required to be witnessed, but it is considered prudent practice for evidentiary purposes.

Please note that this table summarises the key requirements and provisions. For comprehensive information, it is recommended to refer to the specific legislation and guidance notes mentioned in the sources.