Wet ink required, why digital signatures fall short in property deals
Property sales still require a handwritten “wet ink” signature to be legally valid, as digital signatures don’t meet requirements under SA law.
While almost any contract can now be signed electronically, there are, however, exceptions, and importantly, says Tiaan Pretorius, manager for Seeff Centurion, the purchase of immovable property is one of those.
While this may be confusing and even frustrating, prospective buyers and sellers need to be aware that property practitioners are guided by the law and cannot accept digital offers. Property offers to purchase, and agreements of sale must still be signed by hand, in “wet ink,” to be legally valid. This includes any annexures and addendums as well.
The legal basis for this lies in the Alienation of Land Act of 1981, Section 2(1) which mandates that any agreement for the sale of land must be in writing, and signed by all parties involved or their authorised representatives.
Established case law has specifically interpreted this to mean that the required signature must be a “wet ink” signature, and signed by hand. Pretorius explains that this legislation means a verbal agreement for the sale of land is not enforceable, neither is one with an electronic or scanned signature.
Additionally, the Electronic Communications and Transactions Act (ECTA) of 2002 further clarifies this distinction. While ECTA permits the use of electronic signatures for most contracts, Section 4(3) outlines specific exclusions where digital signatures do not meet legal requirements.
This includes agreements for the alienation of immovable property, long-term land leases of 20 years or more, the execution of wills, and the execution of bills of exchange. For these documents, a physical signature is legally mandated, and an electronic signature is not sufficient.
This legal framework is designed to provide a higher degree of certainty and protection for what is often the most significant financial transaction a person will make. The “wet ink” signature serves as an extra layer of authentication, ensuring all parties are physically present and committing to the agreement in a manner that is less susceptible to digital fraud.
While there have been a few individual court cases which have made exceptions, Pretorius highlights that these rulings are based on the specific merits of each case and do not override the fundamental legal requirements.
Prospective buyers and sellers must therefore be aware of this crucial legal requirement. While a digital signature may feel modern and efficient, a property transaction’s legal validity depends on the traditional act of a physical, handwritten signature. Being aware of this upfront can prevent unnecessary delays or complications in the sales process.
Issued by Gina Meintjes
