Corporate & Securities Law

What Does One Do If a Signature Date Is Omitted?

By Ken Adams

One topic we discuss at my “Language and Layout” seminars is when it’s appropriate to have signatories date their signatures, as opposed to relying on the date stated in the introductory clause. (This is discussed in MSCD at 1.16?21 and 4.3?7.)

In a couple of recent seminars I was asked what one does if, in a contract that provides for dated signatures, a signatory fails to date their signature. Presumably this problem can arise when the signatory sends in the signature page by email or fax.

To deal with this problem, you could adjust my recommended dated-signatures boilerplate by adding the sentence in bold italics:

     14.     Effectiveness; Date. This agreement will become effective when all the parties have signed it. The date this agreement is signed by the last party to sign it (as indicated by the date associated with that party’s signature) will be deemed the date of this agreement. If any party signs but fails to date a signature, the date that the Company receives the signing party’s signature will be deemed to be the date that the signing party signed this agreement.

Note that my recommended language anticipates more than two parties. That means that you’d have to designate one party by name in the new language, as the non-signing parties might receive the signing party’s signature on different dates. Designating one party in this manner would only work if one party is responsible for transaction logistics.

Here’s a version for two parties:

     14.     Effectiveness; Date. This agreement will become effective when both parties have signed it. The date this agreement is signed by the second party to sign it (as indicated by the date associated with that party’s signature) will be deemed the date of this agreement. If a party signs but fails to date a signature, the date that the other party receives the signing party’s signature will be deemed to be the date that the signing party signed this agreement.

If you’re concerned about arguments over what date a signature was received?such an argument might arise if the signature was received on a Sunday?you could specify that receipt would be determined “in accordance with section 12 [Notices],” assuming that the notices provision is comprehensive enough to address such issues. (That’s rarely the case.) But referring to the notices provision raises the question whether sending a signature page constitutes notice of the sort that would fall within the scope of the notices provision. So I’d be inclined to omit any reference to the notices provision.

Full post as published by AdamsDrafting on November 01, 2008 (boomark / email).