Electronic Signatures in Commercial Property Transactions

The Land Registry only accepts two methods of electronic signing – Mercury signing and conveyancer-certified electronic signatures.

Common requirements

The following requirements are common to both Mercury signing and conveyancer-certified electronic signatures:

1. With very limited exceptions, all parties must be represented by a conveyancer, including parties who are not signing the relevant document.
2. If a witness is required, they must be physically present. Witnessing by video call is not permitted.
3. All parties must agree to the use of electronic signatures. This is not to say that all parties must use electronic signatures, or neither can. There can be a mixed electronic signature and wet ink, but if any party wishes to sign electronically, all parties must agree to do so.

Mercury Signing

Very much an evolution of traditional signature methods, Mercury signing is a process that replicates traditional ‘wet ink’ signing but in a digital format. Mercury signing uses scans or photographs of printed signature pages through email communication.

Mercury signing is simple in concept, but can be awkward to explain. Section 2.2 of PG82 sets out the Land Registry’s 7-step process to using Mercury signing; the first five steps, with a little commentary, are below.

1. A party’s conveyancer emails the final, agreed copies of the document (including any plans and other annexures) to their client. Unlike conveyancer-certified electronic signing, where any party’s conveyancer can control the signing process for all parties, Mercury signing requires the signing party’s conveyancer to email documents to their own client.
2. The party prints the signature page only.
3. The party signs the signature page in the physical presence of a witness if required.
4. The witness signs the signature page.
5. The party sends a single email back to their conveyancer, attaching the final agreed copy of the document emailed in Step 1 and a scan or photograph of the signed (and witnessed) signature page. This is key: For the party’s email to count as validly signed using Mercury, the full blank document and all annexures must be returned to that party’s conveyancer and attached to a single email. If the party executes documents by more than one signatory, for example, a company signing by two directors, the signatories can sign separate signature pages, but one of the signatories must send the email containing the final agreed copy of the document, and both signed signature pages, to their conveyancer.

If properly followed, the email attachments referred to in Step 5 constitute an ‘original’ document. This allows a conveyancer to assemble as many copies as are required, and each one is an ‘original’. For this reason, a conveyancer is well advised to save the email from their client somewhere it can easily be located in the future.

Conveyancer-Certified Electronic Signatures

A conveyancer-certified electronic signature is an electronic signature that a conveyancer has certified complies with the Land Registry’s requirements. As with Mercury signing, the Land Registry has set out the steps that must be followed to enable a conveyancer to give such a certificate in PG82, specifically paragraph 3.2. Perhaps inevitably, the certificate has become known as a ‘PG82 certificate’.

Typically, people refer to conveyancer-certified electronic signatures by the name of the platforms used to facilitate this, so it is not uncommon to be asked to ‘DocuSign’ something in the course of a transaction.

The Land Registry’s requirements are:

1. A conveyancer must set up and control the signing process. A party cannot upload a document it has received to a signing platform itself. It is entirely legitimate for one party’s conveyancer to set up and control the signing process for all parties. This is one of the ways in which conveyancer-certified electronic signing differs from Mercury signing.
2. The conveyancer controlling the process uploads the document to the signing platform.
3. The conveyancer enters into the platform the name(s), email address(es) and mobile phone number(s) of the signatory/signatories and their witness(es). This means that the parties signing need to know in advance who their witnesses will be – a departure from traditional wet ink signing, and Mercury signing, where the signatory could ask anyone who was available at the time they signed to witness. PG82 gives the option for a signatory to include the details of their witness after signing, but this is rarely used as conveyancers have to be confident that PG82 has been complied with to give the necessary PG82 certificate to the Land Registry.
4. Each signatory will receive an email containing a link to access the documents. Following the link to the documents will trigger the platform to send a text message to the signatory (hence the requirement for their mobile phone number) containing a one-time passcode. The signatory must enter the passcode and can then sign the documents.
5. If a witness is required, the document must be signed in the physical presence of the witness. As a reminder, the Land Registry suggests adding the wording “I confirm that I was physically present when [name of signatory] signed this deed”.
6. Once the signatory has signed, the witness will receive an email containing a link to access the documents. The link will, again, trigger a text message to the witness containing a one-time passcode. The witness enters their information in the same manner as the signatory.
7. The signing platform will capture the date and time of both the signatory and the witness signing.
8. Any fields that are to be filled in must be filled in within the platform.
9. The document must also be completed within the platform. If the signed document is printed and dated by hand, that is not valid for the purposes of the Land Registry’s requirements.

A pdf of the completed document will be emailed to the conveyancer who set up the process. This pdf is an original document, with no need for it to be printed. It can be freely circulated to whoever needs it, and each copy of the pdf is equally an original.

While electronic signatures offer many advantages, there are also challenges that solicitors and clients should be aware of:

Follow the process

As has been highlighted above, the process for electronic signatures is detailed, with opportunities for error. If the Land Registry’s process is not followed precisely, the resulting document will not be acceptable for registration.

Correcting Errors

Errors do happen. Minor ones are typically corrected by hand. The Land Registry has long accepted this for wet ink signed documents, and almost every lawyer dealing with property transactions will, in their time, have received a requisition from the Land Registry requiring a correction by hand and initiated by or on behalf of the parties.

By definition, there are no hard copies of documents signed by way of conveyancer-certified electronic signatures to amend. PG82 contains a process for correcting errors if they are discovered before the document is submitted to the Land Registry for registration. But what if errors are discovered after the document has been submitted? Here, PG82 is not as clear and has changed since the practice guide was first published. It may, therefore, be harder and/or more expensive to correct errors than if the document had been signed with wet ink.

Electronic Signatures are not always permitted

Even where all parties agree on the use of electronic signatures, there are some instances where they are simply not available.

• The Land Registry will not accept companies that electronically seal documents. If a company must execute by affixing its common seal, that will still have to be done physically.
• Where a party signs by way of more than one authorised signatory, e.g. two directors signing on behalf of a company, they must both use the same type of signing. The Land Registry will not, for example, accept a document where one director has signed using Mercury and the other has signed using a conveyancer-certified electronic signature.
• The Land Registry will not accept lasting powers of attorney or statutory declarations signed in any way other than wet ink.

Furthermore, some lenders will insist on wet ink signatures.