How contracts work in England and Wales

Are electronic signatures valid in England and Wales?

Yes, for most contracts. The Electronic Communications Act 2000 makes electronic signatures admissible in evidence, and the Law Commission's 2019 report concluded that an electronic signature is capable in law of executing a document, including a deed, where the signer intends to authenticate it and any formalities are met.

• In England and Wales, an electronic signature is admissible in evidence on any question about the authenticity or integrity of a communication or data.

  Source: Electronic Communications Act 2000, s.7·Checked 7 October 2026Pending lawyer review

• The Law Commission's 2019 report says an electronic signature is capable in law of executing a document, including a deed, where the signer intends to authenticate it and any formalities are met.

  Source: Law Commission, Electronic execution of documents (4 September 2019)·Checked 7 October 2026Pending lawyer review

Which law and courts does a contract name?

Contracts here commonly say they are "governed by the law of England and Wales" and give the courts of England and Wales jurisdiction. 'UK law' is not a single governing law, because Scotland and Northern Ireland have their own. By default, a person who is not a party can sometimes enforce a term meant to benefit them, which is why many contracts exclude the Contracts (Rights of Third Parties) Act 1999.

• A person who is not a party can enforce a term if the contract expressly says so, or if the term purports to confer a benefit on them, unless the contract shows the parties did not intend that. Contracts commonly exclude this right.

  Source: Contracts (Rights of Third Parties) Act 1999, s.1·Checked 7 October 2026Pending lawyer review

When does a document need a deed or a witness?

A deed must say on its face that it is a deed, be signed by an individual in the presence of a witness who attests the signature, and be delivered. The Law Commission's view is that the witness must be physically present even if the deed is signed electronically. Most commercial contracts are usually simple contracts, not deeds.

• A deed must make clear on its face that it is intended to be a deed, and is validly executed by an individual only if signed in the presence of a witness who attests the signature, and delivered as a deed.

  Source: Law of Property (Miscellaneous Provisions) Act 1989, s.1(2)–(3)·Checked 7 October 2026Pending lawyer review

• The same report says a deed must still be signed in the physical presence of a witness who attests the signature, even when the deed is signed electronically.

  Source: Law Commission, Electronic execution of documents (4 September 2019)·Checked 7 October 2026Pending lawyer review

What can't be contracted out of?

Some liability cannot be contracted out of. A term cannot exclude liability for death or personal injury caused by negligence, and other negligence liability can only be limited where the term is reasonable. Contracts with consumers are governed by the Consumer Rights Act 2015 instead.

• Liability for death or personal injury caused by negligence cannot be excluded or restricted by a contract term; other negligence liability can be limited only so far as the term is reasonable. Consumer contracts are carved out to the Consumer Rights Act 2015, whose s.31 lists liabilities a trader cannot exclude in contracts for goods.

  Source: Unfair Contract Terms Act 1977, s.2·Checked 7 October 2026Pending lawyer review

How long do you have to bring a claim?

Six years from the breach for a claim on a simple contract, and twelve years for a contract made as a deed. That difference is one of the main practical reasons a document is executed as a deed.

• An action on a simple contract cannot be brought after six years from when the cause of action accrued; an action on a specialty (such as a deed) has twelve years.

  Source: Limitation Act 1980, ss.5 and 8·Checked 7 October 2026Pending lawyer review

Can you charge interest on late payment?

For business-to-business debts, statutory interest can be claimed on late payment. gov.uk states the rate as 8% plus the Bank of England base rate.

• Statutory interest on late payment of commercial debts is set by order under the Late Payment of Commercial Debts (Interest) Act 1998; gov.uk states the rate as 8% plus the Bank of England base rate.

  Source: Late Payment of Commercial Debts (Interest) Act 1998, s.6; gov.uk guidance·Checked 7 October 2026Pending lawyer review

What a governing-law clause for England and Wales looks like

This agreement and any dispute arising out of or in connection with it are governed by the law of England and Wales. The courts of England and Wales have exclusive jurisdiction.

Frequently asked questions

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