Agreement Under Seal

The concept of signing a „locked contract” goes back many years. In the 19th century, companies used wax seals to prove that the signature on the contract was not falsified. As these contracts are considered more formal, they have often been able to be applied over a longer period of time. With respect to corporations and other entities, the Common Law initially required that all contracts entered into by such a body be classified, whether or not they were acts. This rule was gradually eroded, for example with regard to enterprises, which were abolished in the first half of the twentieth century, but remained in force for other companies until 1960. [11] It was abolished by the Corporate Bodies` Contracts Act 1960. [12] Ordinary contracts (i.e. no documents) can now be concluded by a company in the same way as it can be concluded by an individual. There are two important differences between simple contracts and contracts that are classified (document): delivery is made either by actual delivery to the other party or by the intention that the act be effective, even if it remains held by the party it performs.

It is the only formal contract because it deduces its validity from the form in which it is expressed and not from the fact of the agreement or consideration. A seal contract is considered a more formal contract. Typically, valuable consideration is required to enter into a binding contract, but no consideration is required for a sealed contract. Traditionally, such a contract implies an irrefutable presumption of consideration. (The term „presumption of irrefutable consideration” means that the person who owns the contract can expect to receive the declared value of the contract and that the contractor (who signed the contract) provides the declared value in accordance with the contract without argument. In the past, seals have been affixed to written contracts to testify to the intention of the parties to be legally bound by the conditions they contain. Originally, the courts required that these seals be made from wax. However, over time, the formality of this requirement eroded and courts began to accept alternative means of „sealing” a written instrument, including paper printing.

Today, jurisdictions that recognize sealed documents simply request the inclusion of the word „SEAL” in the signature line. However, when it comes to imposing a party`s obligation from a treaty, these four letters become very important. Under Pennsylvania law, the statute of limitations for written contracts is generally four years. Therefore, if a promisor (i.e., the person making the promise) does not fulfill his or her obligations under a written act, promise him or her (i.e., the person who accepts the promise) four years from the date of delay in bringing legal action. However, everything changes when the document in question is executed „under lock and key”. Under Pennsylvania law, the statute of limitations for „an instrument written under seal” is twenty years. Therefore, if the same promise does not fulfill its obligations under a sealed written instrument, it will remain vulnerable to legal action for twenty years, compared to only four years. .