Signing legal contracts when you’re out of the country

If you’re planning an overseas holiday over the Christmas break, or if you’re overseas at any other time of the year, it’s important to think about how your business will run without you being there. You’ve probably organised the day to day running of the business while you’re away, but you may not have thought about what might happen if formal documents need to be signed in your absence.
Friday, 30 November 2018

2018-11

Most contracts do not become legally binding until it has the signatures of each party involved. By signing off on a document, it confirms each party’s agreement and intention of executing the terms in the contract. Whether you are agreeing to an employment contract, need to formalise financial documents, or if you need to witness the execution of an important document, your signature will be required to seal the deal.

Luckily, thanks to technology, a lot can be signed by email these days. Contracts made via electronic communications (e-commerce) and social media such as Facebook (f-commerce) are all legally binding, as long as they are validly made. Entering into an electronic contract involves the same steps as a paper-based contract.

The Contract and Commercial Law Act (CCLA) clarifies when an electronic contract is formed, including time and place of dispatch, and receipt of electronic communications. But the risks could be greater, as the terms and conditions may go unnoticed. It’s important to keep electronic or printed records of all electronic communications relating to an electronic contract, including any variations.

“If you don’t want to be disturbed while having a break, or if it’s a document that needs an original signature, it’s a good idea to appoint an attorney who can act on your behalf,” says Paula Lines from The Law Shop. 

“If you are a sole trader, you’ll need to appoint an attorney under an Enduring Power of Attorney for Property. You can limit what the attorney can and can’t do, and if you prefer you can have one attorney for dealing with your personal assets and another to deal with the business,” she explains.

“If you’re the director of a company, your personal Enduring Power of Attorney will not be sufficient. The company itself needs to appoint an attorney to be able to act on your behalf as a director. Your attorney can also act on your behalf if you’re unable to due to illness or injury, so it’s a good idea to have all this in place well before you actually need it,” Paula says.

Paula and her team at The Law Shop are experienced in all aspects of business law. They deal with the full cycle from starting, running, and growing to selling a business, and they aim to help you make things easy. Contact The Law Shop’s Rotorua or Tauranga office if you need practical legal advice without the jargon. Whether you're an owner-operator or a large corporate with several subsidiaries, start with an email here.

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