In the case of Gordon James Ramsay v Gary Love  EWHC 65 the High Court has again taken a robust approach to the meaning of “signed” under English law
, confirming that it extends to the use of a signature writing machine by an agent to sign a lease which included a personal guarantee on the part of the principal.
Gordon Ramsay’s father-in-law, Christopher Hutcheson, had worked for Mr Ramsay and/or Mr Ramsay’s companies for approximately 20 years. Mr Ramsay had provided Mr Hutcheson with a signature writing machine (also known as a “ghost-writing machine”) to enable Mr Hutcheson to sign documents on Mr Ramsey’s behalf. In 2008 Mr Hutcheson signed a lease for the York and Albany, a London restaurant, on behalf of Mr Ramsay’s company Gordon Ramsay Holdings International Limited. The lease included a personal guarantee by Mr Ramsay for payment of the £640,000 annual rent.
Mr Ramsay asked the High Court to make a declaration to the effect that he was not liable under guarantee, arguing that:
- He had not known that his signature had been added to the lease.
- Mr Hutcheson did not have authority to sign the lease on Mr Ramsay’s behalf.
The court considered the long-standing working relationship between Mr Ramsay and Mr Hutcheson, Mr Hutcheson’s wide authority to act on Mr Ramsay’s behalf, and the fact that more than 40 documents (including deeds and cheques) had been signed by Mr Hutcheson using the signature writing machine, and refused to grant Mr Ramsay the declaration.
Although the outcome of the case is perhaps not particular surprising, the following points are worth noting:
- Under English law, “an instrument is validly executed as a deed if, and only if: (a) it is signed (i) by him in the presence of a witness who attests the signature or (ii) at his direction and in his presence and the presence of two witnesses who each attest the signature; and (b) it is delivered as a deed”1. The Gordon Ramsay case makes it clear that not only may a signature writing machine be used as an effective means to sign a document, but that the signature writing machine may be operated by another person. It is likely that a similar approach would be taken by the courts in relation to the use of digital or electronic signatures.
- It is well established law that a third party is entitled to rely on the agent’s “apparent authority” (or “ostensible authority”) in situations where the agent is held out as having authority, ie where, having regard to all the circumstances, it is reasonable for the third party to assume that the agent does have authority. As a result, a principal should always ensure that its agents and representatives are aware of the extent of their authority, particularly with respect to signing contracts; although this will not stop a third party being entitled to rely on the agent’s apparent authority, the principal will at least have a claim against the agent for exceeding their authority. And if you are authorising an agent to deal with a third party, you should notify the third party in writing of the limits of their authority, in particular whether the agent is authorised to enter into any contractual commitments on your behalf and, if so, what monetary and/or other limits apply.
- Section 1(3) of the Law of Property (Miscellaneous Provisions) Act 1989.