Who can sign legal documents in New Zealand?

By On Your Terms 
July 2023

Signing legal documents may not be the most exciting thing on your to-do list, but it's super important to get it right.

Whether you're dealing with customer or supplier agreements, leases, deeds, employment agreements or personal documents such as wills and powers of attorney, understanding who can sign these documents, and how, is essential to ensure their validity and enforceability. So, let's dive into this blog on how to sign legal documents in New Zealand.

Who can sign a contract?

Before you enter into a contract, whether it is a simple contract or not, you should check that you, and anyone else signing it, have the authority to sign it to avoid legal issues and unnecessary delays. This will depend on the type of legal document and the person signing it.

If you are signing in your own individual capacity, this is easy.  However, a trust is not a legal entity, so it can’t enter into contracts in its own right. All acts relating to a trust must be undertaken by its trustee(s). The same applies to partnerships.

A company is a separate legal entity from its owners (the shareholders). It can only enter into contracts through its directors and authorised representatives with authority to act on behalf of the company.

Any significant document that a company is signing, should be authorised for signing by a resolution of the board of directors, who will also authorise:

• one or two (usually two) directors to sign to bind the company, or
• if permitted by the company’s constitution and delegated authority policy, another authorised signatory.

Why does it matter what type of legal document I’m signing?

New Zealand law requires certain formalities for signing some legal documents to make them legally binding (which means they can be enforced to uphold promises made in the document).

Some documents, such as deeds, wills, powers of attorney and property-related documents, require witnesses. A witness must be present when you sign and shouldn’t be interested (i.e. benefit from the promises) in the document or connected to you. They must also sign the document, providing their full legal name and contact information. The purpose of the witness is to confirm that you are who you say you are and that you are the one signing.

The list below sets out the signing requirements for individuals, companies, trusts and partnerships for signing contracts/agreements and deeds. It also outlines how to check that you, and the other signatories to the contract, have authority to sign.

Individual Person:

Signing a contract or agreement: If the person has granted someone else power of attorney then the holder of the POA can sign, POAs can be specific, allowing the attorney to sign specific documents, or they can be more general, granting broader powers.

Signing a Deed: Person’s signature must be witnessed

How to check that you (and the other signatories) have authority: Require the attorney to provide both a copy of the POA and a certificate of non-revocation of their POW, which confirms their authority.

If you’re the attorney, check the POA to confirm your signing authority.

Company:

Signing a contract or agreement: If the contract is required (by law) to be in writing, it can be signed by a person with the company’s authority. This could be a director or an employee with the authority to sign.

If the contract or obligation is not (by law) required to be in writing, it can be entered into by the company in writing or orally by a person acting with the company’s authority. This could be a director or an employee with the necessary authority.

Signing a Deed: Two or more directors, or if there is only one director by that director whose signature must be witnessed. 

If the company’s constitution permits, a director or other person or class of persons whose signature(s) must be witnessed.

An attorney validly appointed by the company.

How to check that you (and the other signatories) have authority: Check your company’s delegated authority policy to confirm you have the authority to sign.

If the document is a deed, check the company’s constitution to see whether a non-director, such as a CEO, has been authorised to sign (with a witness). Or, if only one director is signing, check that director is the sole director, and there must be a witness

Search the company at the NZ Companies Office to check the number of directors. If there are multiple directors, but one director is signing the contract, ask for evidence of their authority

Trust:

Signing a contract or agreement: Each trustee must sign.

Signing a Deed: Each trustee’s signature must be witnessed.

If a trustee is a company, that trustee company will also need to meet the requirements of signing as a company.

How to check that you (and the other signatories) have authority: Check the trust deed. It should state whether the trustees have the power to enter into the proposed contract or transaction. Usually all trustees are required to sign legal documents to bind the trust, unless the trust deed specifically states otherwise.

If you are signing a contract with trustees as the other parties, consider requesting a warranty that they have the power to sign the contract on behalf of the trust.

Partnership:

Signing a contract or agreement: Each partner must sign.

Signing a Deed: Each partner’s signature must be witnessed.

How to check that you (and the other signatories) have authority: Check the partnership deed. It should state whether the partners have the power to enter into the proposed contract or transaction.

If you are signing a contract with partners as the other parties, consider requesting a warranty that they have the power to sign the contract on behalf of the partnership. 

Can I sign electronically?

Yes, in New Zealand, most written contracts can be signed electronically.  There are some specific types of documents which the law states can’t be signed electronically, but these are unlikely to be relevant to businesses. There are some rules to ensure the validity of an eSignature:

• Consent – everyone must agree to the use of eSignatures
• Reliability – the eSignature must be reliable and appropriate for the document
• Integrity - the document and signature must remain intact and unaltered after signing
• Recordkeeping – maintain records of the eSignature process

Digital signatures that use cryptographic technology to verify the authenticity and integrity of a document, such as DocuSign, can be used to satisfy the legal requirements for eSignatures. Digital signatures have greater security features than eSignatures.

Key points

To ensure the validity and enforceability of legal documents, it’s important to understand who can sign, how to find out whether that person has authority to sign and whether there are any additional formalities required because of the type of document.

If you are not sure how or who should sign your legal documents, talk to one of our friendly law firm partners.

On Your Terms makes it faster, simpler and more affordable for New Zealand starts ups and small businesses to access top-quality legal solutions and connect with legal experts.  We’re on a mission to make legal information accessible and understandable.