24 April 2020
When an individual is required to sign certain documents (usually as a deed), there is a requirement for there to be a witness to the signing process. These documents include (but are not limited to) the following:
- A power of attorney;
- A conveyance or transfer of land;
- A mortgage;
- A guarantee; and
- A will (there is a legal requirement for two witnesses for this document).
Does the witness sign the document?
Yes. The individual who is party to the document will sign first. The witness will then sign the document as well and note down their details (usually full name, address and occupation) underneath or next to their signature.
What is the purpose of the witness?
The purpose of the witness is to oversee the signing process and if necessary, provide evidence that the document was signed correctly and without duress. The witness will provide their details in case they need to be contacted in future about the execution of the document.
Who can be a witness?
Generally, there is no legal requirement for a witness to any document to be independent i.e. not a relative or connected to the matter (although, a party to the document cannot be a witness to another party’s signature). Given the purpose of the need for a witness (as explained above) it would be best practice to avoid having a witness who was related or connected in any way, as an independent witness would be more likely to give unbiased evidence.
It is also important to consider any requirements which may specifically apply to the type of document that is being signed. In the case of a will, a witness cannot be a beneficiary, because then their interest in the will would be deemed invalid. Similarly, it shouldn’t be a spouse of a beneficiary.
We would therefore advise that a witness should be over the age of 18 and be independent. Independent witnesses can include neighbours, colleagues, or professional individuals such as accountants and advocates.
Despite the above, it may not be inappropriate for a family member to act as a witness for certain deeds, such as where a person is retiring as a trustee of a trust and a deed is required to be executed. In this situation, if a family member is only available to witness the deed, this should not present a problem as it will be clear from other communications from the retiring trustee that he or she has expressed a wish to retire from the trust.
Can an individual witness the signature over skype?
Generally no, a witness must be physically present. The witness must physically see the individual signing the document, which means that the document would be rendered invalid if the witness was present over videolink eg. Skype, Facetime or Zoom.
However, the Emergency Powers (Coronavirus) (Electronic Transmission of Information – Enterprises) Regulations 2020 (the “Emergency Regulations”), which came into force as on 23rd April 2020 and which will apply during the coronavirus period, provides an alternative method of witnessing documents which need to be registered at the Isle of Man Companies Registry. For these documents only, the Emergency Regulations allows electronic communication between a signatory and a witness, providing they are both able to see and hear each other.
Can an individual witness an electronic signature?
If an individual is required to sign a deed electronically, the formalities of the deed must still be adhered to i.e. there must be a witness. The witness must be physically present and observe the individual affixing his electronic signature, and both must affix their signatures at the same computer terminal. The Emergency Regulations may apply for those documents which need to be registered at the Companies Registry.
However, there are certain documents (excluded transactions) which cannot be signed electronically. In these situations, even if the witness was physically present and affixed the electronic signature too, the document would still be invalid.
Do companies require a witness when executing documents?
No. Depending on the type of company, a deed can be signed in the following way:
- For a company incorporated under the 1931-2004 Companies Acts – any two directors or one director and the company secretary;
- For a company incorporated under the Companies Act 2006 – any one director
For each, there is no legal requirement for a witness.
Given the current climate with the Covid-19 crisis, if an individual requires a witness when signing, we believe that asking a neighbour to be witness would be the most practical option. This avoids the potential problems of having a non-independent witness, if a member of the same household was to be asked and it was inappropriate to do so.
When the individual and the witness are signing the document, together with adhering to the general social distancing rules of staying two metres apart, we would recommend that each individual who is required to sign the document wears protective equipment such as gloves and mask and has their own pen.
The above material is of a general nature only. It does not constitute legal advice nor does the distribution or receipt of this material create a client-advocate relationship. Readers should seek specific advice in relation to any decision or course of action.
Author: Sarah Wolter