How To Execute a Deed in Australia

Deeds are a powerful way to record important business commitments - settlement deals, guarantees, IP assignments, variations, and more.

But executing a deed isn’t the same as signing a standard contract. If you don’t follow the correct formalities, you risk ending up with a document that isn’t enforceable when you need it most.

In this guide, we’ll walk you through how execution of deeds works in Australia, who can sign for your company, and the step-by-step process to execute a deed correctly (including electronic signing and counterparts). Our goal is to help you feel confident you’re doing it the right way, so you can reduce risk and move forward with certainty.

What Is A Deed (And Why Execution Rules Are Stricter Than Contracts)?

A deed is a special type of legal instrument that shows a party’s clear intention to be bound, even if no payment or other “consideration” moves between the parties. Because of this, deeds are commonly used to finalise disputes (releases), confirm obligations (guarantees), or transfer rights (IP or confidentiality obligations) where you want a stronger formality than a standard agreement.

If you’d like a refresher on what a deed is and when it’s useful, see our plain-English overview: What Is A Deed.

So why are the rules stricter? Contracts generally require an offer, acceptance and consideration. Deeds do not require consideration, but they do require formal execution steps to be valid. That means the way you sign, witness and date a deed matters (a lot). If those formalities are missed, the deed can fail - which defeats the whole purpose of using a deed in the first place.

Who Can Sign A Deed For Your Company?

If you’re executing a deed as a company, the Corporations Act provides clear signing mechanisms that courts and counterparties recognise. The two most common are:

• Section 127 (company execution): Your company can sign by two directors, or a director and company secretary, or a sole director/sole secretary (for proprietary companies). Correct execution under Section 127 gives the counterparty confidence they can rely on the deed without needing further proof of authority.
• Section 126 (agent execution): Your company may also authorise an individual (an “agent”) to sign on its behalf. This can be done by board resolution, power of attorney, or other internal authority. If you use this pathway, make sure the authority is clear and properly documented under Section 126.

For sole traders and partnerships, the individuals or partners sign personally, following any witnessing requirements that apply in your state or territory.

Practical tip: If there’s any doubt about authority, stick to the Section 127 method. It’s the most straightforward way to avoid challenges to execution.

Step-By-Step: How To Execute A Deed Properly

Below is a simple, business-friendly process you can adapt to your situation. The exact steps can vary depending on the deed type and where the parties are located, but this checklist will keep you on track.

1) Confirm You Actually Need A Deed

Ask: do we need heightened formality (e.g. for a release of claims, guarantee or settlement) or is a standard contract sufficient? If you want a watertight release or you’re documenting obligations without consideration, a deed is often appropriate.

2) Check The Parties And Authority

• Verify the legal names of all parties (company name/ACN, or individual’s full legal name).
• Confirm who will sign and under what authority (Section 127 signatories, a board-authorised agent, or a power of attorney).
• If you’re using an agent pathway, keep the authorising resolution or power of attorney with your records.

3) Finalise The Deed Terms

• Ensure the deed clearly states it is a “deed” and includes any required recitals.
• Double check release language, indemnities, confidentiality and any conditions precedent - these are common risk areas.
• If there are schedules (e.g. a list of assets or definitions), confirm they’re complete and consistent.

If you’re resolving a dispute or ending a relationship, consider whether a Deed Of Release And Settlement is the right document for that outcome.

4) Prepare The Signature Blocks

• Include clear signing clauses for each party (e.g. “Executed as a deed by in accordance with Section 127 of the Corporations Act 2001 (Cth)”).
• Make sure the correct names and titles appear under each signature line.
• If witnessing is required in your jurisdiction for individuals, leave space for witness details and signatures.

5) Choose The Signing Method (Paper or Electronic)

• Decide whether to use wet ink on paper, or an electronic signature solution.
• If signing electronically, align your process with the current rules for deeds and company execution. For a helpful overview of options and pitfalls, see our guide to legal requirements for signing documents.

6) Arrange Witnesses (If Needed)

• For individuals, some states/territories require witnessing for deeds. Confirm who can act as a witness and what they must observe.
• If you need a refresher on who can witness and what they must do, check our quick primer on witness signature rules.

7) Execute, Date And Exchange

• Ensure each party signs in the correct capacity and includes the date (or ensure the date of the deed is clear in the document).
• If signing in counterparts, collate the signed parts and confirm that together they form one deed. You can include a counterparts clause - more on this below.
• Exchange final signed copies and store them securely in your records.

8) Keep A Clean Paper Trail

• Retain the email trails, authority documents (resolutions, powers of attorney), and the fully signed version of the deed.
• If your company has a Company Constitution, keep execution records consistent with it.

If a mistake slips through (e.g. a missing title or incorrect name), get advice promptly. Depending on the issue, you may be able to correct it with a short form amendment or re-execute the deed to avoid enforceability issues.

Electronic Signing, Witnessing And Counterparts

Electronic signing has become mainstream, but deeds still attract extra attention around formality. The rules can also differ slightly by state and over time, so it’s important to use a method that suits your situation and the type of deed.

Electronic Versus Wet Ink

Many deeds can be signed electronically in Australia, particularly when executed by a company using recognised methods. That said, some situations still favour wet ink (for example, where a counterparty or bank insists, or where particular state-based formalities for individuals make e-signing impractical).

For a plain-English comparison of the pros and cons, explore wet ink versus e-signature basics: Wet Ink vs Electronic Signatures.

Witnessing Requirements

Individuals executing deeds may need a witness, depending on the jurisdiction. Make sure the witness is physically present (unless your state allows remote witnessing for the document in question) and that they can observe the entire signing process.

In some cases, limited forms of remote witnessing in NSW are permitted for specific documents, provided strict procedures are followed. If you’re relying on remote witnessing, document the process carefully (e.g. time-stamped recording or an attendee confirmation) and ensure the deed text still aligns with the method used.

Counterparts And Split Execution

It’s common to sign deeds in counterparts - each party signs a separate but identical copy - especially when parties are in different locations. A counterparts clause makes clear that the separately signed copies together form one binding deed. For clarity around process and wording, see executing documents signed in counterpart.

Company Signing Shortcuts

If you’re signing via Section 127, make sure the signatories match the company search (two directors, or director and secretary, or sole director/sole secretary). Using the recognised Section 127 pathway can be particularly helpful for electronic execution, as counterparties can rely on the statutory assumptions about due execution.

Common Deeds For Small Businesses: Risks And Tips

Small businesses tend to reach for deeds at key milestones and pressure points. Here are common scenarios and what to watch for.

Deed Of Release And Settlement

When you’re resolving a dispute (with a customer, supplier, contractor or ex-employee), a deed can provide a clean break with a mutual release. Ensure the release scope is clear, payment/settlement terms are specific, and confidentiality and non-disparagement are covered where appropriate. If you’re documenting a settlement, a Deed Of Release And Settlement is usually the right approach.

Deed Of Assignment

These documents transfer rights - for example, assigning intellectual property or contractual rights. Make sure the rights are properly described, any required third-party consents are obtained, and the effective date is clear. Check that the assignor actually owns the rights being transferred.

Deed Of Variation

When you need to change an existing contract or deed, you can use a deed of variation to record the amendments. Identify the original agreement precisely, set out the changes clearly (preferably with marked-up schedules or replacement clauses), and confirm that all other terms continue unchanged.

Deed Of Waiver/Release/Indemnity

These are often used to manage risk - for example, vendors running events or suppliers dealing with non-standard requests. Use clear, plain-English wording so the person giving the waiver or release understands it. Ensure your process provides fair notice and an opportunity to review before signing.

Director/Parent Guarantees

If you’re taking a guarantee from a director or parent entity, use a deed to capture unconditional obligations and any relevant security. Be very clear about when the guarantee is triggered, any caps, and how long it lasts. If the guarantor is an individual, pay extra attention to witnessing rules.

Practical Tips To Reduce Risk

• Get the capacity right: People should sign in the correct capacity (e.g. Jane Smith as Director of ABC Pty Ltd, not as an individual, unless she is also a party personally).
• Be consistent across pages: If you initial or paginate, do it consistently. If you need help, see our quick guide to initialling documents.
• Avoid “blank spaces” at signing: Populate dates and key fields before execution so there’s no dispute about what was agreed.
• Store signed copies securely: Keep a single, fully signed PDF (and wet-ink originals if used) in a secure folder or document management system.
• Align with other documents: If this deed interacts with a Shareholders Agreement, Employment Contract, or supply terms, check for contradictions that could create loopholes.

Finally, make sure your execution process aligns with the core rules around intent and formality. For a quick refresher on the basics that apply to all documents (not just deeds), have a look at the legal requirements for signing documents in Australia.

Key Takeaways

• Deeds offer stronger formality than contracts and don’t require consideration, but that benefit only holds if you follow the stricter execution rules.
• For companies, sign under Section 127 where possible, or ensure an authorised agent pathway under Section 126 is properly documented.
• Plan the process: confirm parties and authority, prepare correct signature blocks, organise witnessing (if required), and decide on wet ink or e-signing in advance.
• Handle electronic signing and counterparts carefully, and keep a clean paper trail of the authority, signing evidence and the fully executed deed.
• Use the right deed for the situation (release, assignment, variation, waiver, guarantee) and draft in clear, precise terms to prevent future disputes.
• When in doubt, get tailored advice early - fixing execution or drafting issues after the fact is often harder (and more expensive) than doing it right the first time.

If you’d like a consultation on executing a deed for your business, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.