The Covid-19 pandemic continues to reshape the manner in which instructions and transactions have traditionally been executed and has accelerated our embracing of existing and new technology.
The enactment of the Electronic Communications and Transactions Act, No. 25 of 2002, was a key milestone in providing a framework for our electronic evolution and sets forth the following objectives in its preamble:
- to provide for the facilitation and regulation of electronic communications and transactions;
- to provide for the development of a national e-strategy for the Republic;
- to promote universal access to electronic communications and transactions and the use of electronic transactions by SMMEs;
- to provide for human resource development in electronic transactions;
- to prevent abuse of information systems;
- to encourage the use of e-government services; and
- to provide for matters connected therewith.
Section 13 of the Electronic Communications and Transactions Act, 25 of 2002, (hereinafter referred to as the “ECTA”) makes provision for electronic signatures, and we have in more recent times seen a significant shift in the manner in which the greater balance of retail mortgage bond documents are being signed.
Most of the financial institutions have embraced the acceptance of electronically signed retail mortgage bond documents, the security of which are underpinned through the use of advanced digital signature technology, and based on the current trajectory it is anticipated that the signature of mortgage bond documents will eventually be fully migrated to the sole use of electronic signatures.
The use of electronic signatures are however not without limitation and Section 4(3) and Section 4(4) of the ECTA, read in conjunction with Schedule I and Schedule II thereof, sets forth -
(I) the limitations of various sections of the ECTA in relation to the:
- Wills Act, No. 7 of 1953;
- Alienation of Land Act, No. 68 of 1981;
- Bills of Exchange Act, No. 34 of 1964; and
- Stamp Duties Act, No. 77 of 1968.
(II) the limitations of the ECTA in not being construed as giving validity to the execution of:
- An agreement for alienation of immovable property as provided for in the Alienation of Land Act, No. 68 of 1981;
- An agreement for the long-term lease of immovable property in excess of 20 years as provided for in the Alienation of Land Act, No. 68 of 1981;
- The execution, retention and presentation of a Will or Codicil as defined in the Wills Act, No. 7 of 1953; and
- The execution of a bill of exchange as defined in the Bills of Exchange Act, No. 34 of 1964.
It is likely that the effects of the pandemic will continue to be far reaching and will give rise to a range of varied challenges arising from the electronic signature of differing types of agreements and/or documents. One would always be well placed to consult your attorney or conveyancer in any instance which may require clarification of your legal position.
