Backdating contracts and other documents and instruments | Harneys
The question is: can the documents be backdated? which recites what actually happened, and which records the key terms of the transaction. To the layperson, the term "backdate" typically connotes an act of fabrication- backdating also describes the practice of dating a document prior to the time it. Practical Law today but stated that its terms would be enforceable from July , would that be valid and enforceable? End of Document.
For example, a reduction of share capital using the UK solvency statement procedure only takes effect in law when it is actually registered with Companies House.
Backdating Law and Legal Definition
So any attempt to rely on the reduction before registration would be ineffective. You will also need to consider two other things from a legal perspective. Firstly, additional formalities may be needed to complete the legal transfer of assets or granting of rights.
These may include registering the transfer of land or intellectual property rights, or obtaining third party consents or releases. Secondly, the transfer may trigger liabilities, such as where the relevant group companies participated in a defined benefit pension scheme. These two general areas mean that some legal due diligence should be carried out to identify and address areas for corrective action. For example, the selling and buying companies participating in a business transfer may agree between themselves to treat the transaction as if it happened at the previous year end.
This could involve putting in place a business transfer agreement now, which is dated when it is actually signed.
Can you backdate an agreement? | Practical Law
However, backdating a contract should not be done lightly because it easily can be considered a criminal offense that carries quite hefty consequences. Backdating Contracts Backdating contractual documents can be one of the most complex issues that legal professionals have to navigate. While this issue only comes up now and then, when it does, it's important to have a solid understanding of how to proceed.
In terms of private contracts, backdating isn't normally illegal. Where issues of legality come into play is when the parties involved in a contract, or their legal counsel, make use of backdated documents.
When is Backdating OK? | LCN Legal
For legal reasons, you should avoid using backdated documents. In other words, the occasions in which it is appropriate to use backdated documents are rare.
In practice, however, use of backdated documents happens, for better or worse. In French law, Section One of the Forgery and Counterfeiting Act of states that a person can be considered guilty of forgery when he or she produces a false instrument, with the intent that he or she or another person will use it to convince another person that it is real.
For execution as a deed the requirement of signing is a crucial part of the process of creating rights by way of deed, and so it is never permissible to backdate a deed. Probably the most difficult of the grey areas occurs where parties have a recurring commercial relationship which starts informally, but they later decide to document it and agree terms.
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Legally speaking of course what they should do is put a provision in the contract which states that the terms of this contract shall also govern prior transactions which the parties shall henceforth treat as being regulated by those terms. However, where lay persons write contracts themselves or download a pro forma from the internet, often these legal niceties are lost upon them. In practice the courts are more sympathetic than one might anticipate.
Where the parties have obviously and without malice tried to wrap antecedent matters into a contractual framework, the courts will often imply a necessary term into the contract in relation to the regulation of earlier matters, particularly where this does not have an adverse impact on a third party or result in some evasion of taxation or filing fees. Another common example is where one person purports to sign a document on behalf of another person, and then afterwards the parties execute a backdated power of attorney to clothe the signatory with the necessary authority.
You can never be absolutely sure whether it is alive or dead or perhaps alive from a different date than you had anticipated until a judge opens the box for you. Accordingly, the best advice in relation to backdating documents will always remain: