Signing the Dotted Line

“Ah Lawyer,” you may exclaim, “Why write on an insignificant issue like signing a document? Does the issue of signature matter?”
Well, my answer is this: the issue of signature may look insignificant if compared to the content of the document, but in the eye of the law, signing of document matters and it matters a lot.

Want to know why signing of documents matters and the pitfalls to avoid when signing a document? Then, read on:

Signature represents an acknowledgment or endorsement of the document on which the signature is appended. Documents such as letters, agreements, memoranda, power of attorney and court processes require signing.

Where a document requires signing, then, it must be signed. And failure to sign a document renders such a document irrelevant and inadmissible in court when tendered in evidence. In the Supreme Court case of Omega Bank Nig. Plc. V. OBC Ltd. (2005) 1 SC. (Pt.1) 49, it was held: “It is trite law that a document which is not signed does not have any efficacy in law. It is worthless and worthless document cannot be efficacious,” See also the case of A.G. Abia State v. Agbaranya (1999) 6 NWLR (pt.607) 362 at 367.

How Document is Signed

A document is signed when one places his mark or thumb impression on the document there; the mere typing of a person’s name or initials on a document without more is not sufficient to constitute that person’s signature.

To constitute one’s signature, the person must have affixed what he affirms to be his signature which may either be his marks, signs or simply writing his initials thereon. It requires the person doing something overt on the document which is recognizable by the person doing it. See the case of ACB Plc. V. Hatson Nig. Ltd. (1997) 8 NWLR (pt. 515) page 100, pp. 125-126 paras. H-A.

Need for Caution

As important as signing documents is, it is amazing how many people mistakenly fail to sign documents. When you realize the implication of not signing a document, you would learn to take the issue of signature very seriously.

If, for instance, you are relying on a written contractual agreement to enforce the performance of the contract or to claim damages for breach of contract, and the agreement is not signed by you, the content of the document cannot be enforced against the other party.

The effect of such an unsigned agreement is that there was no written agreement. Note however that oral agreement or agreement by conduct may be inferred and used to determine the matter.
Considering the worthlessness of an unsigned document, it is important that we take the issue of signature seriously. Always remember to sign a document before parting with it.

Equally important is the need to be cautious and not to be cajoled into signing any document presented to you for signing. If the document is a court process, summoning you to appear in court, the wise thing to do is sign the endorsement copy and accept your copy given to you. Failure to do so amounts to contempt of court. After collecting the court process, you can take it to your lawyer who would advice you on the content and what you should do.

If it is not a court process, make sure you read the document thoroughly and understand it before you append your signature thereto. If it is not a document you think you should sign, never sign it even if you are being cajoled, forced or intimidated to sign it.

The person cajoling, intimidating or trying to make you to sign a document under duress may whisper to you that he doesn’t want any person to know. That alone is enough to make you suspect. In fact, it is advisable that you don’t sign such a document until your lawyer peruses it and advises you to sign it.

To be on a safer side, if you have a premonition or you are not sure whether to sign a particular document, consult your lawyer. The rule here is: HE WHO HESITATES IS SAVED. Tell the other party to exercise patience until your lawyer reads the content of the document.

On the whole, when signing the dotted line, you must apply discretion. For as the English people would say, “Discretion is the better part of valour.” The next time you want to sign a document, make sure you look before you leap.

Legal Tips on Documentation

In virtually all transactions, documents are relevant. Starting from sales transactions, simple contractual agreement, sale and purchase of land, memorandum of understanding, through to contract of employment, documentation is an issue that should not be toyed with.

There are exceptions of course. For instance, when you are buying some retail commodities like foodstuff, you don’t expect the transactions to be covered with documents.

However, for other products and transactions, the need for documentation cannot be overemphasized. Where proof of title, transaction, agreement, etc is required, tendering of document in respect of same is a valid evidential proof.

The Supreme Court, as per Ogbuagu JSC, held in the case of Sky Bank Plc. & Anor. V. Akinpelu (2010) thus: “It is now firmly settled that documentary evidence is the best evidence.”

Transactions reduced into writing are easier to enforce than parole transations/agreements. Unfortunately, many of us don’t take the issue of documentation seriously.

Receipt

It is common to see people walk into bookshops, supermarkets, business centres, etc to buy products without demanding for receipts. Little things, they say, matter. People who do this never realize the implication of their actions.

Other Documents

Equally crucial are documents other than receipts. There are many people who enter into transactions/agreements without taking time to study the documents covering the transactions/agreements. It is either they are cajoled to sign the documents under the pretext that “everything is okay” or they are so excited or hasty that they think it is not necessary to peruse the documents.

Contract of Employment

In times like these when jobs are hard to come by, many desperate unemployed people fall into the hand of unscrupulous employers whose terms of employment, work rules and what have you, are such that they make life unbearable for their employees, but to their own advantage.

Where the problem starts from is desperation on the part of the job seekers. Many of them are very desperate and are willing to do anything, so far they are being paid salary every month. They never take time to study the employer’s terms of employment.

So, once they are issued letter of offer of employment, out of jubilation, they take up the job. But no sooner had they started work than they desired to tender their resignation. And when they wanted to do so, the employer would remind them of the content of their terms of employment and why they cannot tender their resignation immediately.

For many others, since their earning is not enough for them to save out of it and fall back on it, they have no choice than to remain in their employment, despite the discomfort resulting from the employer’s oppressive terms of employment and work rules.

Financial Agreements

In transactions that require parting with your money, the fact is, you have to “shine your eyes.” (My apology to former NAFDAC boss, Dr. {Mrs.} Dora Akunyili, of blessed memory).

The fact is, the other party to the agreement may reduce into writing a term of agreement that may only favour him and which will be to your own detriment.

In transactions, including property transactions where you are required to make a down payment or deposit, it is important to find out whether the amount you are required to pay is refundable or non-refundable. You may think it is refundable while the reverse might be the case.

How to Benefit from Documentation

You can benefit from documentation by practicing the instructions below:

•  When buying products ensure you demand for invoice/receipt
• When you enter into agreement, ensure the agreement is reduced into writing
• Don’t be cajoled to sign any document without first perusing it
• Don’t sign any document under duress and don’t allow any person to intimidate you into signing a document that you don’t understand. If they persist, tell them you cannot sign any document until you consult your lawyer.
• To be on a safer side, it is advisable that you consult your lawyer and seek his services before you enter into any transaction or sign any document
• If you consult your lawyer to draft a document for you, you have to peruse it also. And if there is any word, phrase or expression you don’t understand, you can ask him for explanation
• Don’t sign or act on any document prepared by a lawyer without first consulting your own lawyer for his perusal and legal advice
• When you are served any document from any court, ensure you take it to your lawyer so that he can offer you his professional legal advice
• Make sure you keep originals, counterparts, and/or copies of documents you sign. They may be valid evidence you will rely on in future when the need arises.

In conclusion, it is worth reiterating that documentation is a serious issue, as documents are the best evidence of facts contained therein. And finally, don’t hesitate to consult a lawyer in matters relating to documentation.

Consultation

If you have questions concerning the subject of documentation or any legal problem, contact us by using the form below:

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Partnership that Works

A partnership is a relationship which exists between two or more persons who carry on business for purpose of making profits. Under Nigerian Law (Companies and Allied Matters Act), the maximum number of persons that can form a partnership is twenty. There is however an exception to this. By section 19 (2) (a) and (b) of the Allied Matters Act (CAMA) Cap C20 LFN 2004, a partnership firms of cooperative society, legal practitioners and chattered accountants are permitted to have more than twenty partners.

The concept of partnership is founded on the fact that two heads are better than one. In terms of capital sourcing, management, marketing, decision making, profit making, risk bearing, etc, partnership may be more advantageous than a sole proprietorship (one-man business).

Nevertheless, partnership business has some drawbacks which makes it almost as risky as sole proprietorship. For instance, the liability of each partner is unlimited and as such, all partners are liable to all debts incurred in the course of running the business. Note however that in a partnership where some members are allowed to act as limited partners, the liability of such partners are limited. Again, the death of the member will lead to the dissolution of the partnership. It is these drawbacks that make a company – private or public – better than a partnership.

In spite of the drawbacks in partnership, the advantages inherent in partnership makes the partnership the ideal business model of many profit-oriented persons.

How to Make Partnership Business to Thrive

If you are contemplating forming a partnership or you are already in a partnership business, it is important to note that there are some structures you must put on ground to make the partnership works. Now, let us look at some of these structures:

1. Register the Business Name of the Partnership

Under part B of CAMA, it is mandatory that a person or persons trading under a business name must have the business name registered at Corporate Affairs Commission (CAC). It is therefore a punishable offence for partners to transact business under an unregistered business name. Apart from the fact that the law makes it mandatory, registering a business name is also beneficial in the following ways:

a. If your business name is registered, you stand a chance of being granted loan by a bank, if you apply for it;

b. If your business name is registered, the bank will allow you to open an account in the name of your business. Operating a business account helps you to separate business money from personal money. Again, operating a current account in the name of your business helps facilitate financial transactions via cheque; and

c. Equally important is the fact that big customers like companies, establishments and governments prefer dealing with firms and businesses which names are duly registered with CAC. Also, having a registered business name helps to build credibility and brand.

2. Application of the Doctrine of Uberrimae Fidei

The doctrine of Uberrimae Fidei is to the effect that transactions must be done in utmost good faith. Basically, agreements are based on trust. Partnership is one of such agreements. For a partnership to thrive, there must be mutual trust among partners. No matter how experienced a solicitor (lawyer) is, if there is no mutual trust among parties in an agreement, there are no words that the solicitor can use in drafting an agreement that will be binding on a dishonest and fraudulent party. If partners cannot trust each other, it may be difficult for them to run their partnership successfully. It is therefore advisable that partners must always act in good faith in respect of the partnership business.

3. Hard Work

A partnership is meant to be a cooperative effort in which all partners are expected to contribute to the smooth running of the partnership. Unless it is agreed that some members can be “dormant partners,” all members must work individually and collectively for the progress of the partnership.

4. Partnership Agreement

Partnership agreement can be entered into orally or formally. But it is advisable that the agreement be made formally, as a formal (written) partnership agreement is easier to enforce than an oral one. Partnership agreement will among other things contain:

a. Names of partners;
b. Nature of business;
c. Mode of dissolution of partnership;
d. Mode of bringing in new partners;
e. Mode of profit sharing;
f. Amount of capital each member will or has contributed;
g. Mode of risk sharing;

Note that the content of partnership agreement is inexhaustible. Everything that the partners wanted to be binding on them should be inserted in the agreement. As a legal document, partnership agreement is drafted by (solicitors) legal practitioners.

Consultancy

For consultation on issues of business name registration, or drafting of Partnership Agreement and Partnership Deed, or company incorporation and incorporation of organization, contact me via the following address:

SUNDAY ADAJI CHAMBERS,
Top Floor, Alh. Sule Akagwu
Shopping Complex, Opp. Motor Park,
Anyigba, Kogi State, Nigeria.
Phone: 07061016859
Email: adajichamber@gmail.com

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