Signing legal documents
There are different requirements for the execution of legal documents depending on who is signing the document such as an individual or a company.
These requirements also differ between Australian states and territories, so we have set out some general information below which addresses those requirements.
Individuals
While the requirements for individuals signing legal documents vary slightly between each State and Territory, a witness should:
- be at least 18 years of age;
- know the person whose signature they are witnessing;
- be satisfied as to that person’s identity; and
- not be a party to the document or be a beneficiary in the case of a testamentary will or trust deed.
Companies
A company can execute a document in any way that it determines, including authorising a person to sign the document on the company’s behalf.
The form of execution needs to be supported by either a provision in the company’s constitution or a resolution of the company’s board.
Some organisations require that legal documents be executed in accordance with section 127(1) or 127(2) of the Corporations Act 2001 (Cth) (Corporations Act).
This allows those organisations to rely on assumptions set out in section 129 of the Corporations Act that the document has been executed correctly.
A company with at least one director and one secretary can execute a document in compliance with sections 127(1) or (2) of the Corporations Act:
- without using company seal by:
- 2 directors signing it; or
- a director and the company secretary signing it; or
- if the company has a sole director who is also the sole company secretary, that person signing it; or
- by affixing the common seal to the document in the presence of the following persons who must also sign the document as evidence that they witnessed the affixing of the seal:
- 2 directors; or
- a director and the company secretary; or
- if the company has a sole director who is also the sole company secretary, that person.
A company with a sole director (and without a company secretary) cannot, execute documents in accordance with either section 127(1) or 127(2) of the Corporations Act.
Section 126(1) of the Corporations Act allows an individual acting with the express or implied authority of the company to make, vary, ratify or discharge a contract.
However, the other party to the document still cannot rely on the assumptions in section 129 of the Act and so they may require some further step, such as providing a copy of a resolution of the sole director authorising the person to sign the document on the company’s behalf.