Commentary on sections of the Act Section 4: Change of form or medium Consequences of non-compliance with the requirements for a change of form
Since the requirement to include a statement on the trade document in its new medium imposes a mandatory formality requirement, failure to include such a statement will result in an invalid change of medium for the purposes of the Act. Similarly, failure to comply with any contractual or other requirements necessary for a change of medium will result in an invalid change of medium for the purposes of the Act.
	While failure to comply with either of the requirements set out in section 4(1) would result in an invalid change of medium for the purposes of the Act, the document created as a result of the purported conversion may nonetheless constitute a newly issued trade document in its own right, with its own date and place of issue. For example, if the purported change is from paper to electronic, but the parties forget to include a statement that the document has been converted, the electronic document could still qualify as an electronic trade document if it satisfies the requirements of the Act. However, since the document is not validly converted under the Act, this could lead to a duplication of the promisor’s obligation. This is because, in the absence of a valid change of medium, the document in its old (paper) form will not automatically cease to have effect. It would need to be separately cancelled and taken out of circulation in order to no longer bind the obligor.