Execution of Contracts

When you execute (sign) a contract on behalf of a company, it is important that it is done properly so that you and others can rely on the contract being properly executed.

If you intend to execute the agreement by the fixing of your company’s common seal to the document, the seal must be fixed and witnessed by:

1. Two directors of the company;
2. A director and a company secretary of the company; or
3. For a proprietary company that has a sole director who is also the sole company secretary that director.

If your company has a sole director who is also the sole company secretary, that should be noted on the agreement by stating “Signature of sole director and sole company secretary” under the director’s signature.

If you do not intend to execute the agreement by fixing your company’s seal, the execution details read: “Executed by XYZ Pty Ltd, by being signed by:” rather than “The common seal of XYZ Pty Ltd was affixed to this document in accordance with its articles of association in the presence of”.

If the agreement is executed without using a seal, it must be signed by:

1. Two directors of the company;
2. A director and a company secretary of the company; or
3. For a proprietary company that has a sole director who is also the sole company secretary that director.

If your company has a sole director who is also the sole company secretary, that should be noted on the agreement by stating “Signature of sole director and sole company secretary” under the director’s signature.

Your company may have included other methods by which it can execute documents in its constitution, but without sighting a copy of the constitution, unless the agreement is executed in one of the methods detailed above, the parties to the contract may not be able rely on the contract as having been properly executed.