More and more buyers and sellers are signing their property contract electronically, with DocuSign being the most common tool being used. If not done properly there can be serious consequences including the contract being void.
What is the law?
A contract signed electronically must comply with the Property Law Act 1974 and the three requirements in the Electronic Transactions (Queensland) Act 2001 to be enforceable. The three requirements are:
Does DocuSign comply?
DocuSign may comply with the three requirements as follows:
So what are the risks?
There are four major risks to keep in mind when signing electronically:
What are our tips?
Our three main tips to avoid the pitfalls of electronic signing are:
Example special condition
"1.1 The parties acknowledge and agree that prior to the signing of this Contract both the Seller and the Buyer consented to the Contract being electronically signed using DocuSign;
1.2. This Contract may be validly created by counterparts electronically signed by each party using DocuSign and shall together be deemed to constitute one and the same instrument;
1.3. It is agreed that the delivery of a counterpart of the Contract bearing an electronic signature rather than a ‘wet’ signature shall be deemed to bind the party whose signature is so represented;
1.4. For the avoidance of doubt, no witnessing of a party’s signature is required;
1.5. The parties agree to be bound by copies of this Contract which has been electronically signed using DocuSign in accordance with this Special Condition;
1.6. The parties agree that they will be bound by, have complied with and will comply with the Electronic Transactions (Queensland) Act 2001, in relation to the execution of this Contract.
1.7 In this Special Condition 1, Docusign means the secure electronic signature technology system operated by Docusign Inc."
If you need help drafting special conditions or have any questions about compliance with electronic signing requirements, please contact us today, we'd be happy to assist you.