Covid-19 has been a blight in most respects however, its impact on the experience of the corporate and business set has hastened lawmakers to appreciate and address the utility of technology in, well, making ‘things’ happen. Since Covid appeared, there have been various iterations of temporary arrangements in relation to the signing of documents, meeting clients and, God forbid, ‘shaking hands on’ a deal or proposal. More recently, and with some minor adjustments, many of these arrangements have now become permanent. Woohoo.
Okay, here are the highlights:
As of 22 February 2022, the Corporations Act 2001 allows companies to hold meetings using virtual technology and to execute documents electronically. The Corporations Law is Commonwealth legislation which means that it is applicable throughout Australia.
Meetings and Resolutions of Company Shareholders or Directors
These can now be held in person, virtually or partly in person and virtually.
If you are thinking of holding totally virtual meetings, you may wish to seek approval from members, to amend your Company constitution to allow for this to happen. You should also be aware that any attempts to hold shareholder meetings virtually, should be reasonable ie at a reasonable time and via an accessible platform.
Signing Company Documents
All companies in Australia can now electronically sign documents (including deeds) that:
- relate to the meetings and resolutions of company shareholders or directors.
- are ordinarily signed under sections 126 or 127 of the Corporations Act 2001 (Cth);
If company documents are going to be signed electronically make sure to:
- Identify the signatory and their intention in relation to the document;
- Be “as reliable as appropriate” for the purpose of the document; and
- Where relevant, seek consent from other signatories to the document (consent can be express or implied). A quick email asking if it’s okay to sign electronically would not go astray.
For those Australian companies which still use a common seal, the fixing of a common seal can now be witnessed using an AV link.
You should also note that the Corporations Law takes a technology-neutral approach so there is no ‘mandate’ to sign documents electronically or use any particular type of technology. Signing in the traditional way is still perfectly acceptable.
Deeds continue to be a bit tricky and depending on the type of Deed, double-check execution requirements relating to Deeds especially outside of NSW, QLD, ACT and Victoria.
Agreements and Contracts
This includes any document, other than a deed, which is intended to have legal effect such as application forms, offers and loan agreements.
Agreements do not always need to be in writing. What’s more, if they are, electronic acceptance of terms has been acceptable in Australia for some time now. Electronic acceptance comes in many forms and can include:
- Checking an “Accept” or “I agree” box
- Typing a name
- Pasting in an image of a signature
- Drawing a name or initial with a stylus or by hand on a touchpad
- Electronically signing with platforms such as DocuSign and Adobe Sign
Just be mindful of the value of the transaction risk. If the agreement involves a long-term or high-value transaction risk, consider the wet-ink option. Some companies may also have internal policies relating to electronic signing which should be considered.
Statutory Declarations and Affidavits
Can now be made and signed electronically and witnessed via an audio-visual link (AV).
The people who can ‘witness’ via AV are:
- An Australian legal practitioner
- A government legal officer who is an Australian lawyer (where documents are prepared in the course of government work)
- A justice or commissioner for declarations
- A notary public
- A justice or commission for declarations employed by the Public Trustee (where the Public Trustee has prepared the document)
Affidavits and Statutory declarations can still be made, signed and witnessed in-person (known as ‘wet-ink’ execution).
Government departments, agencies, courts and tribunals, where statutory declarations and affidavits are commonly used, are in the process of updating their forms to take into account, and align with, the above changes.
E-signing requirements relating to Statutory Declarations and Affidavits may vary slightly from State to State but they are in a similar vein.
Powers of Attorney
General Powers of Attorney for a business may be signed electronically in Queensland. Other Powers of Attorney and Enduring Powers of Attorney continue to require witnessing in-person.
As a general rule, check the rules that apply in the state in which a document is being executed.