Should the Electronic Communications and Transactions Act be amended to include electronic signatures for the sale of immovable property in South Africa?

• Citation: (2023) 140 SALJ 795
• DOI: https://doi.org/10.47348/SALJ/v140/i4a5
• Published date: 08 November 2023
• Pages: 795-812
• Author: Reddy, N.
• Date: 08 November 2023

795

https://doi.org/10.47348/SALJ/v140/i4a5

SHOULD THE ELECTRONIC

COMMUNICATIONS AND TRANSACTIONS

ACT BE AMENDED TO INCLUDE

ELECTRONIC SIGNATURES FOR THE SALE OF

IMMOVABLE PROPERTY IN SOUTH AFRICA?

NIR ISSA REDDY†

Lecturer, North-West University

Electronic signatures have become a core feature of digital transformation.

Organisations can now transact with greater ease, regardless of physical distance or

national borders. The Electronic Communications and Transactions Act 25 of 2002

facilitates electronic communications and transactions using electronic documents and

signatures in South Africa. Electronic contracts and signatures are legally binding

and constitute valid a nd admissible evidence in legal pro ceedings, although there are a

few exceptions. One of the exclusions concerns agreements for the sale of immovable

property. The Alienation of Land Act 68 of 1981, which regulates the sale of land,

seeks to promote lega l certainty as to the authe nticity and contents of these c ontracts to

limit instances of fraud and litigation. This article examines the risk associated with

fraud and the case o f Borcherds v Duxbur y 2021 (1) SA 410 (ECP). In this case,

contrary to legislation, the court accepted an electronic signature in a contract for the

sale of immovable property. I recommend that the relevant legislation be amended to

validate the use of advanced electronic signatures for the sale of immovable property.

A holistic approach to electronic signatures is the only way to embrace an inevitable

and complete digital transformation.

Electronic Communications and Transactions Act – electronic signature –

fraud – im movable property

I INTRODUCTION

Electronic signatures have become a core feature of digital trans-

formation. Organisations can now transact with greater ease, regardless

of physical distance or national borders.1 Electronic signatures

have become a fundamental tool for concluding contracts since the

Covid-19 pandemic and governments’ imposition of social-distancing

requirements worldwide.2 However, even before the pandemic, electronic

transactions had become increasingly popular in the twenty-rst century.

† LLB (UKZN) LLM (Unisa).

1 Juana Coetzee ‘The Electronic Communications and Transactions Act 25

of 2002: Facilitating electronic commerce’ (2004) 15 Stellenbosch LR 501;

Aashish Srivastava ‘Electronic signatures in online transactions: Lessons from

South Africa’ (2016) 45 Common Law World Review 141 at 141–2; Yeukai

Mupangavanhu ‘Electronic signatures and non-variation clauses in the modern

digita l world: The case of South Af rica’(2016) 133 SALJ 853 at 853– 4.

2 Ciresh Sing h ‘Sign on the digita l dotted line — Evalua ting the legal val idity

of electronically signed documents’2021 (August) De Rebus 20 available at

(2023) 140 SALJ 795

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796(2023) 140 TH E SOUTH AFRICA N LAW JOURNAL

https://doi.org/10.47348/SALJ/v140/i4a5

Naturally, the need for the regulation and authentication of these types

of transactions arose.3 The Electronic Communications and Transactions

Act 25 of 2002 (‘ECTA’) is the South African legislation that recognises

and regulates transactions concluded electronically. The ECTA facilitates

electronic communications and transactions and allows for the use of

electronic documents and signatures.4

Mostly, the ECTA alig ns itself with the UN pr inciples articu lated in the

UNCITR AL Model Law on Electronic Com merce 1996 (‘MLEC 1996’).5

The approach that the MLEC 1996 took towards electronic commerce was

one of technological neutrality6 and functional equivalence. Functional

equivalence cons iders how a paper-based require ment could be substituted

with an electronic-commerce technique.7 Does the electronic technique

full the requirements of a paper-based document? Is the document

legible and accessible to all? Will it remain unaltered over time? Can it be

reproduced? Does it provide for authentication through signatures? Is it

legally acceptable?8

In 2001 the UN’s further addition of the UNCITRAL Model Law

on Electronic Signatures (‘MLES 2001’)9 reiterated the principles of

non-discrimination, technological neutrality and functional equivalence.

The MLES 2001 also set out criteria for technical reliability between

electronic and handwritten signatures.

The ECTA recognises two types of legally binding electronic

signat ures. These are cal led ‘electronic signat ures’ and ‘advanced electron ic

signatures’ (‘AES’).10 The origin of the A ES in South African law is based

on the Electronic Signatures Directive 1999/93/EC.11 This directive was

repealed in 2016 by the European Union Regulation No910/2014 of the

European Parliament and of the Council of 23 July 2014 on electronic

https://www.derebus.org.za/sign-on-the-digital-dotted-line-evaluating-the-legal-validity-

of-electronically-signed-documents/, accessed on 6 Februa ry 2023.

3 Wennette Jacobs ‘The Electronic Communications and Transactions Act:

Consumer protection and inter net contracts’ (2004) 16 SA Merc LJ 556 at 556 –7;

Sieg Eiselen ‘Fidd ling with t he ECT Act — Electronic si gnatures’ (2014) 17 PER/

PELJ 2805.

4 See the long title to the ECTA.

5 See https://uncitral.un.org/en/texts/ecommerce/modellaw/electronic_commerce at 20 –1;

Tana Pistoriu s ‘Contract format ion: A comparative per spective on the Model Law

on Electron ic Commerce’ (2002) 35 CILSA 129 at 130.

6 Sect ion 2(1)( f) of the ECTA and Ketler Investments CC t/a Ketler Presentations

v Internet Service Providers’ Association 2014 (2) SA 569 (GJ) para 30.

7 MLEC 1996 at 20–1.

8 Ibid.

9 See https://uncitral.un.org/en/texts/ecommerce/modellaw/electronic_signatures.

10Section 13 of the ECTA and Christo Pienaar, Vania Munro, Rieka van-

Wyk et al Information Technology Contracts (2018) 206–7.

11Lee Swales ‘The regulation of electronic signatures: Time for review and

amendment’ (2015) 132 SALJ 257 at 262.

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