Seal (contract law)

In the courts of common law 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.

Firstly, the following of the legal formality of affixing a seal to a document was evidence of the existence of a contract.

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.

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[6] (most commonly on a contract for the sale of land), although the courts also held that a circle containing the letters "L.S."

The Act implemented recommendations made by the Law Commission of England and Wales in their 1987 report Deeds and Escrows[8] 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 witnessed.

[16] Also, the changes relating to deeds which were introduced in 1989 do not apply to corporations sole such as government ministers or bishops of the Church of England.

It has been noted that "about two-thirds of the [US] states have now adopted statutory provisions depriving the seal of its binding effect,"[19] although several important jurisdictions, such as New Jersey and Wisconsin, have retained the concept.

[20] Schnell v. Nell (1861), which is widely cited as an example of nominal consideration, involved a sealed contract.