Temporary measures that permitted the remote witnessing of documents by audio visual link in NSW in response to COVID-19 conditions have now been made permanent by the Electronic Transactions Amendment (Remote Witnessing) Act 2021 (NSW). This enables documents to be signed and witnessed by individuals and businesses without the requirement of a witness being physically present to observe the signature. The signatory and witnesses do not need to be located in NSW. The introduction of electronic witnessing is advantageous to both clients and legal practitioners in terms of time and cost efficiency and enabling better access to legal services for people in remote areas, of poor health and old age.
Documents that may be remotely witnessed
Documents that may be remotely witnessed include:
- Wills
- Power of Attorneys/Enduring Power of Attorneys
- Appointments of Enduring Guardians
- Statutory Declarations
- Affidavits
- Deeds
Requirements
In order to comply with the remote witnessing provisions set out in the Electronic Transactions Act 2000 (NSW), the witness must:
- Observe the signatory signing the document in real time;
- Sign the document or an exact copy of the document that is signed by the signatory. This can be done by signing a counterpart of the document or a scanned copy of the signed document;
- Be satisfied that the document they sign is the same document, or a copy of the document, signed by the signatory; and
- State the method used to witness the signature of the signatory (e.g. Zoom, Skype, WhatsApp) and that the signature was witnessed in accordance with section 14G of the Electronic Transactions Act 2000 (NSW).
Who qualifies as a witness?
Who can witness a document depends on the document itself. A witness can generally be anyone over the age of 18 who isn’t a party to the document or a beneficiary of a trust contained within the document and who knows the person whose signature they are witnessing or who has taken steps to verify the identity of that person. However, some documents require the witness to belong to a specific class of persons. Such documents include statutory declarations, which require the witness to belong to an approved class of persons. Affidavits and other legal documents signed under oath or declaration also have specific witnessing requirements and must be signed before a justice of the peace, Australian legal practitioner, notary public or Australian or British Consular Officer.
Electronic and Digital Signatures
Electronic signatures are an electronic representation of a signature or a symbol that is accepted by the signatory intending to sign an agreement. Examples of electronic signatures are signatures at the bottom of emails, a typed name, a scan of a person’s signature and ‘I Agree’ buttons. Digital signatures are electronic signatures that have additional layers of authenticity requiring proof of identity and are usually accompanied by digital certificates.
Documents that may be signed with electronic or digital signatures include agreements, contracts, legal correspondence and deeds. Companies may now sign documents by electronic or digital signature following the introduction of the Corporations Amendment (Meetings and Documents) Act 2022 (Cth).
Despite the introduction of electronic witnessing provisions, electronic signatures are still not possible for a number of documents such as wills, powers of attorney (not part of a commercial arrangement), guardianship appointments and affidavits. Temporary changes have been made to legislation to enable statutory declarations to be made using electronic signatures, however these changes are currently only in place until 31 December 2022.
Concerns
One significant concern associated with remote witnessing is the potential for third parties to influence the execution of legal documents during a remote witnessing session, where a third party is present in the room influencing the signatory, unbeknown to the witness. To avoid this scenario, signatories should be identified appropriately, asked if any other individuals are present and invited to consent to a recording of the remote witnessing session. A signatory must also possess mental or testamentary capacity in order for the document to be considered valid. The signatory must possess both understanding of the content within the document and voluntariness to sign the document. There are a number of assessments that should be made to establish mental or testamentary capacity, including consideration of a signatory’s responses to questions, as well as their reactions and body language. It is worth noting that mental capacity tests will be different depending on the nature of the legal document, as a person may have the mental capacity to manage or understand one subject matter but not another.
To overcome the concerns highlighted above, it is imperative that steps are taken to establish the signatory’s identity, test capacity, maintain privacy and confidentiality and keep sufficient records. Provided appropriate measures are taken by the witness, the benefits of remote witnessing in providing efficient and affordable access to legal services alleviate potential risks.
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