In the midst of coronavirus (COVID-19) and quarantine mandates, companies are struggling to close current transactions, increase lines of credit with lenders, and finalize various matters. One hurdle is how to effectively notarize documents when offices are closed and in-person meetings are not permitted. Many states are enacting legislation to allow either temporary or permanent remote online notarization so that documents can be effectively notarized.
Remote Online Notary Statutes
As of March 29, 23 states have enacted remote online notary (RON) laws, 17 of which are currently in effect.
In the few states where RON laws have been enacted but are not yet in effect, RON services are currently permitted by an emergency guidance or executive order enabling RON services due to COVID-19. But with respect to those states that have enacted RON laws that are not yet in effect and where no emergency guidance or executive order enabling RON services has been issued, RON services cannot be performed.
In addition to the states that have enacted RON laws, several other states have issued executive orders or emergency guidance permitting RON services during the COVID-19 pandemic.
In those states where RON services are currently permitted (either on a permanent or temporary basis), there may be limitations on how and when notarizations may be done remotely as well as on the services and providers that are permitted to provide RON services. In certain cases, the provider must satisfy enumerated regulations; in others, a RON may only use a provider that has been approved by the appropriate state regulatory authority.
A number of states have introduced bills, which have not yet been approved or signed into law, to enact RON statutes, and if such bills are approved, they still may require additional executive orders or emergency guidance in order to become effective on an expedited basis. Given the recent executive orders and emergency guidance issued in a number of states, additional states may follow suit, so this information is likely to change frequently.
It should be noted that some of the states that do not have RON laws have statutes or guidance expressly recognizing the validity of RON services performed in another state and in compliance with the laws of such other state.
See our chart, Remote Online Notary Statutes in the United States, which will be updated as guidance changes.
SECURE Notarization Act 2020
The full faith and credit clause of the US Constitution states, “Full faith and credit shall be given in each state to the public acts, records and judicial proceedings of every other state. And the Congress may by general laws prescribe the manner in which such acts, records and proceedings shall be proved, and the effect thereof.” The Securing and Enabling Commerce Using Remote and Electronic Notarization Act of 2020 (SECURE Notarization Act 2020), as currently drafted, would further support the full faith and credit clause by expressly authorizing notaries in the United States to perform RON services using audio-visual communications and tamper-evident technology in connection with interstate transactions.
While a number of states permit electronic notarization, typically under a uniform electronic transactions act enacted in the applicable state, RON services are distinctly different from electronic notarization as electronic notarization continues to require physical presence. Electronic notarization allows the notarization of an electronically executed document, but the signer must still personally appear before the notary.
Recognition of New Laws
Despite RON laws, the provisions of the Constitution, and the pending SECURE Notarization Act 2020, it is important to recognize that some recorders’ offices may refuse or be hesitant to accept such notary services if they are not permitted under the laws of the state in which the recording will occur. If this does occur, using vendors such as title companies (which have been deemed essential businesses in most jurisdictions) to assist with recording may be beneficial to the parties so they can work with the recorder’s office to explain the process and new notary laws.
For our clients, we have formed a multidisciplinary Coronavirus COVID-19 Task Force to help guide you through the broad scope of legal issues brought on by this public health challenge. We also have launched a resource page to help keep you on top of developments as they unfold.