However, backdated documents can be illegal or even criminal. If an anti-dating document misleads a third party or gives a false impression of when an action was taken, it may be fraudulent. The intentions of the parties are also important in assessing whether backdating is legal. Some treaties make this clearer than others. Many contracts define the “start date” as the “effective date” (not to be confused with the execution date). Others will even have a “from” clause that even clearly states the possibility of backdating by saying: Contrary to popular belief, the backdating of documents is not necessarily illegal. In fact, this has been allowed for so long that there is a Latin expression, nunc pro tunc, which describes backdated documents. Another, less likely, reason for Juzek`s anti-dating is the increase in its ancient value. Many violins have value not only as musical instruments, but also as antiques. Although musicians buy an instrument based on its reaction and sound, an older instrument may be more valuable to a collector than a brand new one, simply because it is old.

As with violin labels, the backdating of legal documents can be legal and even advised. It is the responsibility of the parties to a document to ensure that their intentions are honest and that the backdating does not harm third parties or violate legal requirements. When in doubt, significant disclosure of the back-up of the document itself may be helpful in addressing the remaining concerns. The most common example of the correct use of anti-dating is the commemoration of an event that has already taken place. For example, if Uncle Joe told his nephew Stevie on the 10th. March 2019 loaned $50,000, with the verbal agreement that Stevie will repay Uncle Joe in 1 year with interest of 5% per year, it would be quite acceptable to recall this agreement by issuing a promissory note on April 5. 2019, which reflects this understanding, and the note must be dated “from” March 10, 2019. To a layman, backdating seems like a bad thing. But this can be right or wrong. Its legitimacy depends on its purpose and effect. In some cases, backdating is pure fabrication.

It is of course inappropriate to date a document to one date, but the event occurred on a different, later date. Typically, this type of backdating occurs when the beneficiary of the anti-dating can obtain some kind of tax or other benefit if the event occurred on the earlier date. Before the Court of Appeal, the main issue was whether the loan agreement had been backdated, so the previous $290,000 was part of the loan. The Court of Appeal dismissed the ACTL`s application and confirmed that the money was a loan. The result? ACTL was ordered to pay D4 more than $3 million, including accrued interest, as the repayment was due in 2007. However, not all anti-dating involves manufacturing. Backdating can also include the practice of dating a document to the date the event occurred, even if it is signed later. Here, the event occurs before the document that occupies it can be executed, and the document simply remembers the previous event. This is both a common and legitimate use of anti-dating. When we say “backdated,” we generally mean the execution of a document and its dating from a date before the actual date of execution, with the intention that it be treated as if it were establishing legal rights before the actual date. . In other cases, the parties may enter into a transaction orally “by handshake” with the intention of reaching a written agreement later.

Many years ago, one of my clients was in urgent need of borrowing $1 million. To my surprise, a benevolent lender transferred the funds to the undocumented loan client, but with the hope of receiving a promissory note later. Thus, many contracts and agreements are reviewed and negotiated after the start of trade or enthusiastic discussions have already taken place – sometimes for months. Fortunately, most jurisdictions allow the signing of contracts, including NDAs, with a retroactive date. This is commonly referred to as “anti-dating”. In my practice, clients often ask me if they can date a document with a date earlier than the date they actually sign the document. This is called “anti-dating”. Although the term anti-dating often has a negative connotation, there are certain circumstances in which anti-dating is quite legitimate. In such a situation, the parties are often tempted to date the service contract to March 1 to ensure that the service contract establishes and confirms the rights relating to the services that took place from that date. However, the parties are often unaware that this effect can be achieved by including an “effective date” or “departure clause” in the service contract, which states that although the service contract is dated April 1, its provisions apply from March 1. That start date, which is considered to be earlier, should also be recognised in the clause on the duration of the agreement in order to ensure consistency and to clearly demonstrate the intention of the parties.

For your lawyer: Be clear. Hopefully, most lawyers already aim to write clearly, but this is all the more important when there is some complexity, as in this case. In an ideal world, it would have been useful to explicitly state that the $290,000 was part of the loan and to distinguish between the date of signature (2006) and the date on which the loan was first advanced (2005). A “status” date is not the only way for parties to disclose that they are anti-dated a document. In a treaty or resolution, recitals[1] can tell the story, including anti-dating. Let`s take the following example: 3. Does any of the parties receive a special advantage or avoid a disadvantage due to anti-dating? Given the realities of the world, backdating is now part of everyday business, and that probably won`t change anytime soon. However, it is important that when signing a retroactive document, this fact is clearly disclosed and used for legitimate and appropriate purposes. Backdating, which is used to deceive a third party or violate the law, is always an inappropriate invention, and no form of disclosure will remedy such misconduct. CONSIDERING that on or about July 15, 2018, the Seller began the sale of deliveries to the Buyer under an oral agreement based on the terms and conditions described in the Offer; and using the example of a $1 million loan above, among other facts, the backdated note may have been fraudulent. Suppose the client deliberately planned not to sign the promissory note because he had told his joint venture partner that the funds were a capital contribution that did not need to be repaid.

In this case, while it is appropriate to document the loan by means of a promissory note, the underlying transaction may have been part of a plan to mislead a third party. Perhaps the most common form of anti-dating is “ab” data. Often, at the beginning of a contract, it is stated that it was concluded “from” a certain date. .