Seal (contract law)
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In the
law Law is a set of rules that are created and are law enforcement, enforceable by social or governmental institutions to regulate behavior,Robertson, ''Crimes against humanity'', 90. with its precise definition a matter of longstanding debate. ...
, a
seal Seal may refer to any of the following: Common uses * Pinniped Pinnipeds (pronounced ), commonly known as seals, are a widely range (biology), distributed and diverse clade of carnivorous, fin-footed, semiaquatic, mostly marine mammal, mar ...
affixed to a
contract A contract is a legally enforceable agreement between two or more Party (law), parties that creates, defines, and governs mutual rights and obligations between them. A contract typically involves the transfer of goods, Service (economics), ser ...
or other
legal instrument Legal instrument is a law, legal term of art that is used for any formally executed written document that can be formally attributed to its author, records and formally expresses a legally enforceable act, process, or contractual duty, obligation ...
has had special legal significance at various times in the jurisdictions that recognise it. In the courts of
common law In law, common law (also known as judicial precedent, judge-made law, or case law) is the body of law created by judges and similar quasi-judicial tribunals by virtue of being stated in written opinions."The common law is not a brooding omnipres ...
jurisdictions, a contract which was sealed ("made under seal") was treated differently from other written contracts (which were "made under hand"), although this practice gradually fell out of favour in most of these jurisdictions in the 19th and early 20th century. The legal term ''seal'' arises from the wax seal used throughout history for
authentication Authentication (from ''authentikos'', "real, genuine", from αὐθέντης ''authentes'', "author") is the act of proof (truth), proving an Logical assertion, assertion, such as the Digital identity, identity of a computer system user. In ...
(among other purposes). Originally, only a wax seal was accepted as a seal by the courts, but by the 19th century many jurisdictions had relaxed the definition to include an impression in the paper on which the instrument was printed, an embossed paper wafer affixed to an instrument, a ''
scroll A scroll (from the Old French ''escroe'' or ''escroue''), also known as a roll, is a roll of papyrus, parchment, or paper containing writing. Structure A scroll is usually partitioned into pages, which are sometimes separate sheets of papyrus ...
'' made with a pen, or the printed words "Seal" or "L.S." (standing for the
Latin Latin (, or , ) is a classical language belonging to the Italic languages, Italic branch of the Indo-European languages. Latin was originally a dialect spoken in the lower Tiber area (then known as Latium) around present-day Rome, but through ...
term ''locus sigilli'' meaning "place of the seal"). Notwithstanding their reduced significance, seals are still used on contracts, usually in the impression on paper form.


Legal significance in contract law

Until modern
statutory A statute is a formal written enactment of a legislative A legislature is an deliberative assembly, assembly with the authority to make laws for a Polity, political entity such as a Sovereign state, country or city. They are often contraste ...
reforms in
contract law A contract is a legally enforceable agreement between two or more Party (law), parties that creates, defines, and governs mutual rights and obligations between them. A contract typically involves the transfer of goods, Service (economics), ser ...
, a seal was widely recognised by courts in
common law In law, common law (also known as judicial precedent, judge-made law, or case law) is the body of law created by judges and similar quasi-judicial tribunals by virtue of being stated in written opinions."The common law is not a brooding omnipres ...
jurisdictions as removing the need for
consideration Consideration is a concept of English law, English common law and is a necessity for simple contracts but not for special contracts (contracts by deed). The concept has been adopted by other common law jurisdictions. The court in ''Currie v Mis ...
(value) in a contract. This reflects classical contract theory, in which consideration was viewed as a formal aspect of a contract, so that a seal could be considered an alternative form. A seal was not ''per se'' a type of consideration, but rather raised a
presumption In the law of evidence, a presumption of a particular fact can be made without the aid of proof in some situations. The invocation of a presumption shifts the burden of proof from one party to the opposing party in a court trial. There are two ...
of consideration (courts have varied in their opinions of whether this presumption was rebuttable). See, e.g., Marine Contractors Co. Inc. v. Hurley, 365 Mass. 280, 285-86 (1974). The rationale for this special treatment of sealed contracts can be understood in terms of the legal formalities that are associated with sealing a document with a wax seal. Firstly, the following of the legal formality of affixing a seal to a document was evidence of the existence of a contract. Secondly, the need to use a seal – widely known to have legal significance – served to impress upon the parties the significance of the agreement being made. This element of deliberation is important in the context of many legal theories for why donative promises are not generally enforceable in the same way as contracts: there is a concern that donative promises are sometimes made under pressure (for example, from family members) without adequate deliberation, which explains why a requirement for the legal formality of the seal might substitute for consideration to give enforceability to donative promises. Thirdly, the following of the legal formalities through the use of a seal demonstrated beyond doubt that a legal transaction was intended by the parties. In addition to these three abstract reasons, there may also have been a more practical reason, namely that the object used to imprint the wax, usually an engraved
signet ring A seal is a device for making an impression in Sealing wax, wax, clay, paper, or some other medium, including an embossment on paper, and is also the impression thus made. The original purpose was to authenticate a document, or to prevent interf ...
, identified its owner, thereby providing evidence that the owner of the seal was party to the contract. Besides substituting for consideration, other consequences of the seal that, at least historically, have held include: * even payment did not discharge a sealed contract, if the instrument itself was not physically destroyed. *
fraud In law, fraud is intentional deception to secure unfair or unlawful gain, or to deprive a victim of a legal right. Fraud can violate civil law (e.g., a fraud victim may sue the fraud perpetrator to avoid the fraud or recover monetary compe ...
was not permitted as a defence to a sealed contract * subsequent modifications to a sealed contract were not binding except where the modifications were also under seal. * a principal not designated as such in the contract (''undisclosed principal'') could not be connected to the contract if it was sealed. * an instrument under seal may also enjoy a longer statute of limitations within which it may be enforced.


Position in different jurisdictions


England and Wales

In
England and Wales England and Wales () is one of the three legal jurisdictions of the United Kingdom. It covers the constituent countries England and Wales and was formed by the Laws in Wales Acts 1535 and 1542. The substantive law of the jurisdiction is Engli ...
, the common law courts originally recognised only wax seals, but this requirement was gradually relaxed. By the 20th century a small circle of red adhesive paper affixed to the document in question was sufficient when an individual had to use a seal (most commonly on a contract for the sale of land), although the courts also held that a circle containing the letters "L.S." was adequate. The
common law In law, common law (also known as judicial precedent, judge-made law, or case law) is the body of law created by judges and similar quasi-judicial tribunals by virtue of being stated in written opinions."The common law is not a brooding omnipres ...
rule which required that a
deed In common law, a deed is any legal instrument in writing which passes, affirms or confirms an interest, right, or property and that is signed, attested, delivered, and in some jurisdiction (area), jurisdictions, seal (emblem), sealed. It is com ...
made by a private individual had to be sealed to be validly executed was finally abolished in 1989 by the Law of Property (Miscellaneous Provisions) Act 1989. The Act implemented recommendations made by the Law Commission of England and Wales in their 1987 report ''Deeds and Escrows'' and replaced seals with the requirements that the document had to explicitly state that it was being executed as a deed, and had to be
witness In law, a witness is someone who has knowledge about a matter, whether they have sensed it or are testifying on another witnesses' behalf. In law a witness is someone who, either voluntarily or under compulsion, provides testimonial evidence, e ...
ed. With regard to
companies A company, abbreviated as co., is a legal entity representing an association of people, whether natural, legal or a mixture of both, with a specific objective. Company members share a common purpose and unite to achieve specific, declared ...
and other corporate bodies, the common law originally required that all contracts made by such a body had to be made under seal, whether they were deeds or not. This rule was gradually eroded away, for example being abolished in respect of companies by the Companies Acts in the first half of the twentieth century, but until 1960 remained in force for other corporations. It was abolished by the Corporate Bodies' Contracts Act 1960. Normal contracts (i.e. not deeds) can now be made by a corporation in the same way as they can be made by an individual. The Companies Act 1989 removed the requirement for a company to have a common seal at all, and made provision for those documents which had previously needed to be executed under seal, such as deeds, to instead be executed by officers of the company. However companies can still have and continue to use seals to execute deeds if they wish, in which case the seal has to be engraved (i.e., a seal which leaves an impression on the page, not printed or a wafer facsimile) and to bear the name of the company. Some other corporations (which are not companies registered under the Companies Acts) are still required to have and use seals. For example, the
Royal Charter A royal charter is a formal grant issued by a monarch under royal prerogative The royal prerogative is a body of customary authority, privilege and immunity, recognized in common law and, sometimes, in Civil law (legal system), civil law ...
incorporating the
Royal College of Nursing The Royal College of Nursing (RCN) is a registered trade union in the United Kingdom for those in the profession of nursing. It was founded in 1916, receiving its royal charter in 1928. Queen Elizabeth II was the patron until her death in 2022. ...
requires the College to have a common seal, as does that of the
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. Also, the changes relating to deeds which were introduced in 1989 do not apply to corporations sole such as government ministers or
bishops A bishop is an ordained clergy member who is entrusted with a position of Episcopal polity, authority and oversight in a religious institution. In Christianity, bishops are normally responsible for the governance of dioceses. The role or offic ...
of the
Church of England The Church of England (C of E) is the State religion, established List of Christian denominations, Christian church in England and the mother church of the international Anglican Communion. It traces its history to the Christian church record ...
. Therefore, where a corporation sole has to execute a deed, it continues to have to do so by the use of an official seal.


United States

In the
United States The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country Continental United States, primarily located in North America. It consists of 50 U.S. state, states, a Washington, D.C., ...
, wax seals were never expressly required. The Restatement of Contracts (Second) notes that
Impressions directly on the paper were recognized early and are still common for notarial and corporate seals, and gummed paper wafers have been widely used. In the absence of statute, decisions have divided on the effectiveness of the written or printed word 'seal', the printed initials 'L.S.' ..., a scrawl made with a pen (often called a 'scroll') and a recital of sealing.
The relaxation of the definition of a ''seal'' was generally contemporaneous with reduced distinctions given to sealed contracts. This trend can be seen as a parallel of the courts' modern relaxation of their interpretation of the
Statute of Frauds The Statute of Frauds (29 Car 2 c 3) (1677) was an Acts of Parliament in the United Kingdom, Act of the Parliament of England. It required that certain types of contracts, will (law), wills, and grants, and assignment or surrender of leases or i ...
, and reflects the evolution of modern contract theory from classical contract theory. It has been noted that "about two-thirds of the Sstates have now adopted statutory provisions depriving the seal of its binding effect," although several important jurisdictions, such as New Jersey and Wisconsin, have retained the concept.See NJSA 2A:14-1, 2A:14-4, 2A:25-1, and most importantly, 2A:82-3. See also Wis. Stats. 891.27, Bradley Bank v. Tomahawk Pulp & Paper Co., 242 N.W. 505 (Wis. 1932) '' Schnell v. Nell'' (1861), which is widely cited as an example of nominal consideration, involved a sealed contract. Although the distinction of seal had already been abolished by
Indiana Indiana () is a U.S. state in the Midwestern United States, Midwestern United States. It is the List of U.S. states and territories by area, 38th-largest by area and the List of U.S. states and territories by population, 17th-most populous o ...
statute, it is likely the parties viewed the seal as making the contract enforceable, much as the nominal consideration of $1 would have under classical contract theory.


See also

* Great Seal *
Lord Privy Seal The Lord Privy Seal (or, more formally, the Lord Keeper of the Privy Seal) is the fifth of the Great Officers of State (United Kingdom), Great Officers of State in the United Kingdom, ranking beneath the Lord President of the Council and abov ...
* Formalities in English law


Notes

{{DEFAULTSORT:Seal (Contract Law) Seals (insignia) Contract law