SECTION 3 - LIABILITY AND THE NOTARY
A. The Notary's Personal Liability
As a notary public, you are personally liable for every service that you perform. The state expects you to properly perform your duties. If you don't and there is a loss, you are liable and this liability is unlimited. Failure to require personal appearance of the signer at the time the notarial act takes place, failure to properly identify a signer, and performing a notarial act when the notary is personally involved and has an interest in the act taking place are direct violations of Florida notary laws. Additionally, you can also be sued for the damages that you cause by an improper notarization.
Illustration of a Notary's liability
A lawsuit was filed against a notary named Mary for notarizing a forged signature. On the day of the notarization, Mary had notarized the signature of her cousin Kathy and Kathy's father, John (Uncle John) on several documents. Kathy and John came to Mary's office. Later in the day, Kathy came back with another document which was a deed transferring a piece of property from her father (Uncle John) to her. The document was already signed. Kathy explained that they had forgotten this document and that her father was now at work and could not come back to Mary's office. Mary knew that she could not notarize when the signer was not present, but thought that it was okay this one time because Kathy and John were family and she had already notarized for Uncle John earlier that day.
Shortly after the notarization, Kathy moved out of town. Several months later Uncle John received a notice of foreclosure on his home that he had paid off years earlier. You can probably guess what was happening. Kathy had forged her father's signature on the deed to his property, then went to the bank and secured a mortgage for $19,600 on the property. She never made a payment and the bank was now foreclosing. When Uncle John looked at the deed used for collateral, he found that his signature had been forged. He filed suit against the bank for relying on a fraudulent deed and the bank filed suit against Mary for her illegal notarization. In the end, the bank lost their claim to the property and John got his property back. But, the Court awarded the bank a judgment against Mary for $19,600. Additionally, Mary's bonding company paid out the entire amount of her bond, which was $7,500 and Mary had to repay the bonding company. By doing a favor for a friend, the notary was held personally liable for over $27,000. And, to make matters worse, Mary lost her notary commission and will never again be able to be a notary in the state of Florida. Imagine holiday dinner with this family!
B. Employers Liability
Not only are you personally liable, but your employer is liable if you perform the notarial act while you are on the job. Florida notary law is very specific on this topic. It would be up to the courts to decide how much either you or your employer would have to pay. Often, people who have had a loss will go after the employer who may have more resources. Remember that you have a personal liability and if you are sued for some notary error, the court could enter a judgment against you.
Coercion by Employer. Often, a notary will be coerced or pressured into notarizing something improperly. For instance, an employer may insist that a notary perform an act without the signer present. Coercion by employers is becoming an increasing problem. Employers should never ask their employees that are notaries to disregard notary laws. In addition to this practice being unethical and illegal, it could result in the employer, as well as the notary, being liable in the event of any lawsuit against the notary for improper notarization.
C. Errors and Omissions Insurance
Protection for the Notary. Errors and Omissions (E&O) Insurance protects the notary from claims of negligence. It is very similar to medical malpractice insurance. If a doctor makes an error when treating a patient, he is then liable to the patient for the suffering and damages caused by his negligence. Obviously, he will have to have an attorney represent him and settle the matter. The doctor certainly didn't mean to make an error, he was just being negligent by not checking the patient's chart before surgery. He simply made an error because of his omission of a crucial step (checking the patient's chart) in performing his duties. E & O insurance works much the same way. E & O at this time is not required by law, but is highly recommended because it will pay for your errors and your omissions as a notary. Of course, the insurance company will not pay when there is an intentional violation.
Attorney Fees. If you have to defend yourself against a claim of misconduct, you will want and need legal representation. Errors and Omissions Insurance would cover any legal expenses and/or court costs that you incur defending your reputation.
Policy Costs. It is important for you to understand the limits of an E & O policy. Typically, E& O insurance is relatively inexpensive and is worth the investment. Huckleberry Associates sells a $25,000 E & O insurance policy, which will cover the notary for the four (4) year notary commission.
An interesting thought: It would be a lot easier to purchase E&O insurance for around $60 today than to have to write a check for several thousand dollars and up, after having made a mistake as a notary. This is true even if it was an honest mistake!
D. Disciplinary Action, Revocation, and Criminal Penalties
Disciplinary Action. Notaries are subject to charges for any violation of the law. Any disciplinary actions will have a serious effect on the notary's commission and the notary's ability to renew a commission. The notary's reputation is affected and it could be difficult for the notary to obtain a notary commission in the future.
Revocation. The Governor may be required by a court of law to take action and remove a notary from office. This is a serious and very complicated issue. Again, obtaining a notary commission in the future could be difficult.
Criminal Penalties. Some notarial violations carry criminal penalties. The law states that there are criminal penalties associated for several types of violations. These include notarizing your own signature, acting as a notary after your commission has expired, making a false notarial certificate and failure to require the personal presence of the signer.
You may be asking, is there anyway to protect myself as a notary from liability? Unfortunately the answer is no, but you can certainly reduce it. Huckleberry Associates, Inc., makes the following suggestions:
E. Keeping a Journal.
Notaries have at their disposal two powerful tools: the notary seal and the Journal of Notarial Acts hereinafter referred to as a journal. You may also hear the journal called a notary journal, log or a register.
Florida law does not require the use of a Journal of Notarial Acts. However, you may be interested to know that the Governor's Task Force on Notaries Public, which our company served on, recommended the mandatory use of journals. Although this law has not been passed by the Florida Legislature at this time, Huckleberry Associates, Inc., strongly recommends using the journal to record your notarial acts. The Journal of Notarial Acts is for your own protection and for the protection of the public and your employer.
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Every time you notarize a signature or perform any notarial duty, you should record certain facts about the notarial act. For your protection, your journal should be securely bound with numbered pages and the entries should be consecutively numbered as well. A journal with these features is designed to prevent someone from tampering with your book or altering it. You should record vital information about the signer, like his/her name, address, and telephone number. The single most important piece of information you will record in the journal is the signer's original signature. That signature proves that the person personally appeared for the notarization. You will also record details about the signer's identification. Be sure to write in the specific type of ID, the serial number and the expiration date.
Record information about the document such as the type, name or description of the document, the date of the document and any other information you consider important.
You will also note the date and time of the notarial act and the type of notarial act performed (oath, acknowledgment, marriage etc...).
Any fee that you charge for the notarial act should be recorded in the journal.
The journal also has a space to record any special circumstances or comments. You should record anything that could be used later to refresh your memory about a notarization.
F. Advantages of Keeping a Journal
It serves as a reminder. The journal records the steps of notarization and will serve as a reminder of your responsibilities. Do not leave any of the items blank in any of the journal entries.
It may prove compliance. The entry in this book may very well prove that you complied with the law.
It can refresh your memory. The journal could be used to refresh your memory regarding a particular notarization after several weeks, months, or even years.
It could be used as evidence. The journal could be relied upon in court as evidence. You may not remember anything about the notarization or the signer in question, but based on the information you recorded in the Journal of Notarial Acts, you would be able to give sworn testimony in court about the essential facts of a particular notarization. It will also prove your credibility as a notary if you record every notarial act in the journal. The advantages of keeping a journal far outweigh the extra time that it takes to record the information and the nominal cost of the book. We recommend that you do not share a journal with any other notary and the you keep your journal for at least four years after the last entry. It is reasonable to believe that any question about a notarization or lawsuit would arise within that time period.