He then faxed his copy back to me. Are faxed copies and faxed signatures legal? What is a notary public? Who can be a witness to a document? Is a spouse or. Create, print or download a personal Loan Agreement document in minutes with the entire amount back in one lump sum on a specified date or upon demand. Yet, for the business lawyer, backdating documents is often not only permissible, but is a regular and necessary part of everyday practice.
Inside Track: Backdating documents: Not necessarily the stuff of scandal :
However, he rarely adds that he actually ended up losing that trial, which brings us to my second point — even though the law generally deprecates the backdating of documents, the legal consequences of backdating are highly variable. This article will try to unpick the various legal threads of when you can and cannot backdate documents, and what the consequences will be if you do.
The first and most important thing to note about the consequences of backdating a document is that it is potentially a criminal offence. However, at common law this was a criminal offence going by the contradictory sounding name of uttering a false document and in most English law based legal systems it is still an offence today, although in many cases statutory provisions have superseded the common law for example, in the British Virgin Islands see section of the Criminal Code Where backdating is done for financial gain, it may also constitute the more dull-sounding criminal offence of obtaining a pecuniary advantage by deception.
Although criminal prosecution might be a risk in serious fraud cases, in most day to day legal matters where backdating occurs for reasons of administrative convenience, or simply by oversight or error, the risk of being charged with a crime are commensurately small.
But even if a person is not charged with a crime, the fact that a crime can be demonstrated to have occurred may still impact the rights of the parties. In certain cases a criminal act may negate insurance.
Lack of a prosecution does not mean a lack of legal consequences. However, such doctrines are normally limited to situations where one party backdates the contract without the knowledge or consent of the other. Where both parties consent to the backdating of the document, normally the courts in common law countries will simply disregard the backdating of the document, and treat the rights as accruing from the date when the document was actually executed.
Backdating contracts and other documents and instruments
Although in exceptional cases — where third party rights are not affected — the courts might be persuaded to treat the stated date as being the effective date, a situation we return to below.
So is it ever OK to backdate a document? There are rare occasions when it may be permissible or even justified to do so. The practice is of dubious legality, and its widespread use led the SEC to scrutinize hundreds of companies. Yet, for the business lawyer, backdating documents is often not only permissible, but is a regular and necessary part of everyday practice. The challenge for the business lawyer is determining when backdating is legitimate and when it is not.
However, backdating to memorialize a prior act or event is a legitimate and necessary practice. Past acts and events can — and often must — be documented. To protect themselves, their firms and their clients, attorneys should always be certain their backdating falls into the latter category.
Perhaps the most fraudulent form of impermissible backdating is documenting and dating an act that never occurred. This is always inappropriate.
Is backdating legal? - Lexology
Additionally, backdating is impermissible when the backdated document describes an act that actually occurred, but at a date subsequent to the date of the document, in order to secure benefits to which a party is not entitled. Drafting and executing a document after an event occurs, but in a manner that accurately reflects the date on which the event transpired, is a permissible form of backdating. This is backdating that memorializes, something the United States Court of Appeals for the Seventh Circuit has recognized as a legitimate practice.
For example, if parties clearly reach an agreement on Dec. This is simply the accurate memorialization of a past event, something that is essential to legal practice. Each of the above are examples of situations where attorneys may legally backdate documents. Staying in bounds Staying on the right side of the misrepresentation-memorialization line is critical. Attorneys who inappropriately backdate documents can face ethical sanctions, lawsuits and even criminal prosecution.
Unfortunately, it is sometimes difficult to determine whether backdating misrepresents or memorializes. There are several reasons for this difficulty, including that ambiguous law might govern the time of an event and relevant facts may be uncertain. Because they can create uncertainty regarding the date of an agreement, both present challenges for a lawyer considering backdating a document. As a matter of contract law, it is not always easy to determine when parties reached an agreement.
An agreement is typically the product of various oral and written negotiations, which often take place over weeks or months. That the parties reached an agreement is usually clear. However, the exact date of the agreement often is not, and the law may be ambiguous as to the moment when an agreement is reached.