In times often described as the “digital era” and with present quarantine measures making the signing of contracts in the presence of both parties particularly difficult, many people ask whether an agreement of sale of land can be concluded virtually, in other words, with an electronic signature. The answer is no; however, the Electronic Communications and Transactions Act 25 of 2002 (ECTA) allows for the following:
ECTA is only one of several sources of law that regulates electronic communications and transactions and it must consequently not be read in isolation of relevant statutory and common law.
1 Agreements concluded via electronic communications
It is generally in order to conclude agreements via electronic communications. For example, you can enter into a valid and binding agreement to sell your laptop or enter into a lease agreement via email if: the correspondence clearly indicates the terms of the agreement; there is an intent to come to a binding arrangement, and the relevant emails clearly belong to and is sent by the parties involved.
2 Advanced electronic signatures
Should there be a statute in place requiring signature before a document will be considered legally valid, but the statute does not specify that the signature must be in writing, ECTA dictates that an advanced electronic signature (AES) may be used. (An AES is a special ‘electronic’ signature – a scanned image of a handwritten signature, or ‘digital’ signature – which, in certain instances, may replace the traditional pen and ink manner to sign documents. In order to use an advanced electronic signature on a document, one first has to have the AES accredited with an accreditation authority in South Africa.)
3 Where a written signature is required
If by law it is specifically stated that a written signature is required, an AES will not suffice (eg, the assignment of copyright in terms of the Copyright Act, which that Act requires to be in writing). Certain agreements are, however, specifically excluded from the above, importantly, agreements concluded in terms of the Alienation of Land Act 68 of 1981.
Nevertheless, this does not exclude the signing of a sale agreement using email. For example, if A was to make an offer to buy B’s property, A can print the offer, sign it in pen; scan and email it to B. If B accepts the offer, he can print the offer, sign the offer in acceptance and scan the signed agreement back to A. Thereby a valid and binding agreement of the sale of land is concluded.