February 25, 2021

Volume XI, Number 56

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Australia: What Happens When Electronic Signatures are Affixed Without Authority?

A recent NSW Supreme Court decision, Williams Group Australia Pty Ltd v. Crocker [2016] NSWCA 265, found that a personal guarantee was not enforceable against an individual where the electronic signature had been affixed without the knowledge or authority of the individual.

This finding applied notwithstanding that the electronic signature was a ‘genuine’ signature uploaded to the relevant execution system “HelloFax”, and that Williams Group Australia Pty, who sought to rely on the signature, had no knowledge of any impropriety with respect to the affixation of the signature.

The Court appeared to approve existing authority which provided the placement of a ‘genuine’ electronic signature on a document without any authority would likely amount to forgery at common law. Such a forgery could not be ratified, and would render the contract void.

The case is a reminder for any person seeking to rely on electronically signed documents to have in place adequate steps and protections to ensure all electronic signatures have been affixed with proper authority. Even a ‘genuine’ electronic signature may be unenforceable against an individual if it is affixed without proper authority.

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Copyright 2020 K & L GatesNational Law Review, Volume VI, Number 308
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About this Author

Jim Bulling, KL Gates, financial services lawyer, funds management attorney
Partner

Mr. Bulling's practise focuses on banking and financial services and he acts for a range of entities in the financial services and funds management industry. His clients include Australian and international investment managers, banks, trustees of superannuation funds, wholesale and retail investment trusts, funds management companies and financial planning groups.

His main areas of focus include banking and financial product disclosure issues, financial services compliance issues, financial product distribution issues and superannuation and...

61-3-9640-4338
Julia Baldi, KL Gates, commercial contracting lawyer, Australian regulatory requirements attorney

Ms. Baldi is a corporate and regulatory lawyer with a focus on the healthcare and life sciences services industries. Ms. Baldi advises clients on a range of issues including commercial contracting, compliance with Australian regulatory requirements, privacy, risk management and transaction structuring.

Ms. Baldi's clients include public and private health service providers, pharmaceutical, medical device and biotechnology companies, private health insurers and aged care and retirement living operators.

61-3-9640-4212
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