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VT House Bill 526

Legislation

State: Vermont
Signed: May 22, 2018

Effective: July 01, 2019
Chapter: Act No. 160

Summary

House Bill 526 enacts the Revised Uniform Law on Notarial Acts, bringing welcome changes to Vermont's Notary statutes.

Affects

Adds 26 V.S.A. Chapter 103 (Sections 5301-5378); amends 27 V.S.A. Sections 341-343; and repeals 24 V.S.A. chapter 5, subchapter 9; 27 V.S.A. Section 379; 32 V.S.A. Section 1403(b); 32 V.S.A. Section 1436; and 32 V.S.A. Section 1759.

Changes

Definitions

  1. Defines “acknowledgment,” “‘certificate’ or ‘notarial certificate,’” “commission term,” “electronic,” “electronic signature,” “in a representative capacity,” “notarial act,” “notarial officer,” “notary public,” “office,” “official stamp,” “person,” “record,” “sign,” “signature,” “stamping device,” “state” and “verification on oath or affirmation.”

Notary Commission

  1. Sets a commission issuance fee of $15.
  2. Requires an applicant for a Notary commission to meet the following qualifications: (a) be at least 18 years of age; (b) be a citizen or permanent legal resident of the United States; (c) be a resident of or have a place of employment or practice in Vermont; (d) not be disqualified to receive a commission under Section 5342 of Chapter 103; and (e) pass a basic examination approved by the Secretary of State based on the statutes, rules, and ethics relevant to notarial acts.
  3. Requires an applicant for a Notary commission to execute an oath of office and submit it to the Secretary of State before a commission is issued to the applicant.
  4. Clarifies that a commission to act as a Notary authorizes the Notary to perform notarial acts and does not provide the Notary any immunity or benefit conferred by Vermont law on public officials or employees.
  5. Permits the Secretary of State to deny, refuse to renew, revoke, suspend or impose a condition on a Notary commission for any act or omission that demonstrates the individual lacks the honesty, integrity, competence, or reliability to act as a Notary, including (a) failure to comply with Chapter 103; (b) a fraudulent, dishonest, or deceitful misstatement or omission in the application for a commission as a Notary; (c) a conviction of the applicant or Notary of any felony or a crime involving fraud, dishonesty or deceit; (d) a finding against, or admission of liability by, the applicant or Notary in any legal proceeding or disciplinary action based on the applicant’s or Notary’s fraud, dishonesty, or deceit; (e) failure by a Notary to discharge any duty required of a Notary, whether under the new chapter, rules of the Secretary, or any federal or State law; (f) use of false or misleading advertising or representation by a Notary representing that the Notary has a duty, right or privilege that the Notary does not have; (g) violation by a Notary of a rule of the Secretary regarding a Notary; (h) denial, refusal to renew, revocation, suspension or conditioning of a Notary commission in another state; or (i) committing any of the conduct set forth in 3 V.S.A. § 129a(a).
  6. Provides that if the Secretary of State denies, refuses to renew, revokes, suspends or imposes conditions on a Notary commission, the applicant or Notary is entitled to timely notice and hearing in accordance with 3 V.S.A. Chapter 25.
  7. Provides that every two years, the Secretary of State shall provide a renewal notice to each commissioned Notary, and upon receipt of a Notary’s completed renewal, payment of the fee as set forth in Section 5324 of Chapter 103, and evidence of eligibility, the Secretary shall issue to him or her a new commission.
  8. Requires a Notary applying for renewal to complete continuing education approved by the Secretary of State, which shall not be required to exceed two hours, during the preceding two-year period.
  9. Requires the Secretary of State, with the advice of the advisor appointees, to establish by rule guidelines and criteria for continuing education credit.

Notarial Acts

  1. Defines “notarial act” as including taking an acknowledgment, administering an oath or affirmation, taking a verification on oath or affirmation, attesting a signature and noting a protest of a negotiable instrument.
  2. Clarifies that “notarial act” does not include a corporate officer attesting to another corporate officer’s signature in the ordinary course of the corporation’s business, and further clarifies that Chapter 103 may not be construed to require the use of a Notary to witness a signature that is allowed by law to be witnessed by an individual who is not a Notary.
  3. Permits a Notary commissioned under Chapter 103 to perform notarial acts in Vermont and clarifies that the signature and title of the individual performing a notarial act is prima facie evidence that the signature is genuine and that the individual holds the designated title.
  4. Prohibits a Notary from performing a notarial act with respect to a record to which the Notary or the Notary's spouse is a party, or in which either of them has a direct beneficial interest, and further provides that such notarial act is voidable.
  5. Provides requirements for taking an acknowledgment, taking a verification of a statement on oath or affirmation, attesting a signature and noting a protest of a negotiable instrument.
  6. Repeals the statutory fees for notarial acts.

Authority to Perform or Refuse to Perform Notarial Acts

  1. Permits a Notary to refuse to perform a notarial act if the Notary is not satisfied that the principal signer is competent or has the capacity to execute the record or that the individual’s signature is knowingly and voluntarily made.
  2. Authorizes a Notary to refuse to perform a notarial act unless refusal is prohibited by other law.

Appearance and Identification of Signer; Signature of Person Unable to Sign

  1. Provides that if a notarial act relates to a statement made in or a signature executed on a record, the individual making the statement or executing the signature must appear personally before the Notary.
  2. Clarifies that the requirement for a personal appearance is satisfied if: (a) the Notary and the person executing the signature are in the same physical place; or (b) the Notary and the person are communicating through a secure communication link using protocols and standards prescribed in rules adopted by the Secretary of State pursuant to the rulemaking authority set forth in Chapter 103.
  3. Provides that a Notary has personal knowledge of the identity of an individual appearing before the Notary if the individual is personally known to the Notary through dealings sufficient to provide reasonable certainty that the individual has the identity claimed.
  4. Provides that a Notary has satisfactory evidence of the identity of an individual appearing before the Notary (a) through presentation of a passport, driver’s license, or government issued non-driver identification card, which is current or expired not more than three years before performance of the notarial act; or (b) presentation of another form of government identification issued to an individual, which is current or expired not more than three years before performance of the notarial act, contains the signature or a photograph of the individual, and is satisfactory to the Notary; or (c) by a verification on oath or affirmation of a credible witness personally appearing before the Notary and known to the Notary or whom the Notary can identify on the basis of a passport, driver’s license, or government issued non-driver identification card, which is current or expired not more than three years before performance of the notarial act.
  5. Allows a Notary to require an individual to provide additional information or identification credentials necessary to assure the Notary of the identity of the individual.
  6. Provides that if an individual is physically unable to sign a record, the individual may direct an individual other than the Notary to sign the individual’s name on the record and requires the Notary to insert “Signature affixed by (name of other individual) at the direction of (name of individual)” or words of similar import.

Certificate of Notarial Act

  1. Requires each notarial act to be evidenced by a certificate that: (a) is executed contemporaneously with the performance of the notarial act; (b) is signed by the Notary in the same manner as on file with the Secretary of State, and dated by the Notary; (c) identifies the jurisdiction in which the notarial act is performed; (d) contains the Notary’s title; and (e) contains the Notary’s commission expiration date.
  2. Prohibits a notarial officer from signing a notarial certificate on a tangible or electronic record until the notarial act has been performed.
  3. Clarifies that the text of a notarial certificate is sufficient if it: (a) is in a short form contained in Section 5368 of Chapter 103; (b) it is in a form otherwise permitted by Vermont law; (c) is in a form permitted by law applicable in the jurisdiction in which the notarial act is performed; or (e) sets forth the actions of the Notary and the actions are sufficient to meet the requirements of Sections 5362-5364 of Chapter 103 (affirming the Notary has authority to perform notarial acts, disallowing a disqualifying interest of the Notary or the Notary’s spouse, and requiring the signer to be present).
  4. Clarifies that in executing a notarial certificate, a Notary certifies that he or she has complied with the requirements of Sections 5363-5365 of Chapter 103 (stating the requirements for particular notarial acts and requiring the signer to be present at the time of notarization and identified on the basis of personal knowledge or satisfactory evidence).
  5. Prohibits a Notary from signing or logically associating the signature with a certificate until the notarial act has been performed.
  6. Requires that a certificate for a paper record must be part of, or securely attached to, the record.
  7. States that a notarial certificate must be affixed to or logically associated with an electronic record according to any standards established by the Secretary of State, if standards have been published.
  8. Adopts new short-form certificates for all authorized notarial acts.

Official Stamp and Stamping Device

  1. Requires the Notary’s official stamp to include the Notary's name, jurisdiction, and other information required by the Secretary of state; and be capable of being copied together with the record to which it is affixed or attached or with which it is logically associated.
  2. Provides that if Notary performs a notarial act regarding a tangible record, an official stamp must be affixed to or embossed on the certificate or, in the alternative, the Notary must clearly print or type the Notary’s name and commission number on the certificate.
  3. Provides that if a notarial act regarding an electronic record is performed by a Notary and the certificate is signed and dated by the Notary, contains the jurisdiction in which the notarial act is performed and contains the Notary’s title and expiration date, an official stamp may be attached to or logically associated with the certificate.
  4. Provides that a Notary is responsible for the security of the Notary’s stamping device and must not allow another individual to use the device to perform a notarial act.
  5. Provides that if a Notary’s stamping device is lost or stolen, the Notary or the Notary’s personal representative or guardian must notify promptly the Secretary of State on discovering that the device is lost or stolen.

Notarial Acts on Electronic Records

  1. Requires that any technology used by a Notary to perform a notarization on an electronic record must be tamper-evident.
  2. Permits a Notary to use one or more tamper-evident technologies approved by the Secretary of State by rule to perform notarial acts on electronic records.
  3. Prohibits any person from requiring a Notary to perform a notarial act with respect to an electronic record with a technology the Notary has not selected.
  4. Clarifies that any technology the Notary intends to use to perform notarial acts on electronic records must comply with any standards established by the Secretary of State if the Secretary of State has established standards.

Prohibited Acts and Offenses

  1. Prohibits a person from performing or attempting to perform a notarial act or holding himself or herself out as being able to do so in Vermont without first having been commissioned as a Notary.
  2. Prohibits a person from using in connection with the person’s name any letters, words or insignia indicating or implying that the person is a Notary unless commissioned in accordance with Chapter 103.
  3. Prohibits a person from performing or attempting to perform a notarial act while his or her commission has been revoked or suspended.
  4. Clarifies that prosecution for a prohibited act may occur upon the complaint of the Attorney General or a state’s attorney and shall not act as a bar to civil or administrative proceedings involving the same conduct.
  5. Clarifies that a commission as a Notary does not authorize an individual to assist a person in drafting legal records, give legal advice or otherwise practice law.
  6. Prohibits a Notary from withholding access to or possession of an original record provided by a person who seeks performance of a notarial act by the Notary, except as otherwise allowed by law.
  7. Provides that a person who one of these prohibited acts shall be subject to a fine of not more than $5,000 or imprisonment for not more than one year, or both.

Validity of Notarial Acts

  1. Provides that except as otherwise provided in Subsection 5372(b) of Chapter 103, the failure of a Notary to perform a duty or meet a requirement specified in Chapter 103 does not impair the marketability of title or invalidate a notarial act or a certification evidencing the notarial act.
  2. Provides that an acknowledgment that contains a Notary commission expiration date that is either inaccurate or expired does not invalidate the acknowledgment if it can be established that on the date the acknowledgment was taken the Notary’s commission was active.
  3. Clarifies that the validity of a notarial act under Chapter 103 does not prevent an aggrieved person from seeking to invalidate the record or transaction that is the subject of the notarial act or from seeking other remedies based on Vermont law other than Chapter 103 or law of the United States.
  4. Provides that defects in the written evidence of acknowledgment in a document in the public records may be cured by the Notary who performed the original notarial act.
  5. Requires a Notary who cures a notarial act performed by the Notary to, under oath and before a different Notary, execute a writing correcting the defect.
  6. Clarifies that notwithstanding the failure of a Notary to perform any duty or meet any requirement specified Chapter 103, including the failure to comply in full or in part with the requirements of Sections 5367-5369, a document that conveys an interest in real property is recordable in the land records and, if recorded, is sufficient for record notice to third parties, provided there is not another provision of law to the contrary.
  7. Clarifies that Section 5373 does not validate a purported notarial act performed by an individual who does not have the authority to perform notarial acts.

Recognition of Notarial Acts

  1. Clarifies that a notarial act performed in another state, under the authority and in the jurisdiction of a federally recognized Indian tribe, under federal law, or under authority and in the jurisdiction of a foreign state or constituent unit of the foreign state or is performed under the authority of a multinational or international government organization, has the same effect under Vermont law as if performed by a Vermont Notary if the act is performed by a listed individual, as specified.
  2. Provides that the authenticity of the official notarial stamp and signature of a Notary may be evidenced by either: (a) a certificate of authority from the Secretary of State authenticated as necessary or (b) an apostille from the Secretary of State in the form prescribed by the Hague Convention of October 5, 1961.
  3. Provides that an apostille in the form prescribed by the Hague Convention of October 5, 1961, and issued by a foreign state party to the Convention, conclusively establishes that the signature of the notarial officer is genuine and that the officer holds the indicated office.
  4. Provides that a consular authentication issued by an individual designated by the U.S. Department of State as a notarizing officer for performing notarial acts overseas and attached to the record with respect to which the notarial act is performed conclusively establishes that the signature of the notarial officer is genuine and that the officer holds the indicated office.

Applicability

  1. Provides that the new law applies to a notarial act performed on or after the effective date of the new law.
  2. Requires a Notary, in performing notarial acts on and after the effective date of the new law, to comply with the provisions of the new law.
  3. Clarifies that a Notary commission in effect on the effective date of the new law will continue until its date of expiration.
  4. Provides that a Notary who applies to renew a commission on or after the effective date of this act must comply with the provisions of the new law.
  5. Clarifies that the new law does not affect the validity of a notarial act performed prior to the effective date of the new law.

Exemptions

  1. Exempts judges, superior court clerks, court operations managers, probate registers, case managers, docket clerks, assistant judges, county clerks, and after-hours relief from abuse contract employees, persons employed as law enforcement officers certified under 20 V.S.A. Chapter 151, noncertified constables, or employees of a Vermont law enforcement agency, the Department of Public Safety, of Fish and Wildlife, of Motor Vehicles, of Liquor Control, or for Children and Families, the Office of the Defender General, the Office of the Attorney General, or a State’s Attorney or Sheriff from all of the requirements of the new law when acting within the scope of their official duties except for the requirement to apply for a commission and pay the fee for the commission (unless otherwise exempted).
  2. Exempts attorneys licensed to practice in Vermont from the examination and continuing education requirement.
  3. Provides that if a complaint of a violation of Chapter 103 is filed against a Vermont attorney, the Secretary of State will refer the complaint to the Professional Responsibility Board and request a report back from the Board regarding the disposition of the complaint.
  4. Exempts the following applicants for a Notary commission from paying the fee for a commission: judges, clerks, or other court staff, as designated by the Court Administrator; state’s attorneys and their deputies and assistant attorneys general, public defenders and their staff, justices of the peace and town clerks and their assistants, and state police officers, municipal police officers, fish and game wardens, sheriffs and deputy sheriffs, motor vehicle inspectors, employees of the Department of Corrections and employees of the Department for Children and Families.

Secretary of State Duties

  1. Outlines the duties of the Secretary of State’s office, which includes: (a) providing general information to applicants for commissioning as a Notary; (b) administering fees as provided under Section 5324 of Chapter 103; (c) explaining appeal procedures to Notaries and applicants and explaining complaint procedures to the public; and (d) receiving applications for commissioning, review applications, and grant and renew commissions when appropriate under Chapter 103.
  2. Requires the Secretary of State to appoint two Notaries to serve as advisors in matters relating to notarial acts, one who must be an attorney selected from a list of at least three licensed attorneys provided by the Vermont Bar Association.
  3. Specifies that the advisors are to be appointed for staggered five-year terms and serve at the pleasure of the Secretary, and further clarifies that one of the initial appointments must be for less than a five-year term.
  4. Requires the Secretary of State to seek the advice of the advisor appointees in carrying out the provisions of Chapter 103.
  5. Provides that appointees shall be entitled to compensation and reimbursement of expenses as set forth in 32 V.S.A. § 1010 for attendance at any meeting called by the Secretary of State.
  6. Permits the Secretary of State, with the advice of the advisor appointees, to adopt rules to implement Chapter 103, and prescribes the scope of the rules.
  7. Requires the Secretary of State to maintain an electronic database of Notaries through which a person may verify the authority of a Notary to perform notarial acts and that indicates whether a Notary has notified the Secretary that the notary will be performing notarial acts on electronic records.

Effective Date

  1. Provides that the new law takes effect on July 1, 2019, except for the following: (a) the Office of Professional Regulation will perform the duties of the assistant judges and county clerks in regard to receiving applications and commissioning Notaries as set forth in 24 V.S.A. Chapter 5, Subchapter 9 for the two-year Notary commission terms that begin on February 1, 2019; (b) the office of Professional Regulation may adopt rules in accordance with the provisions of Section 1 of the act prior to the effective date of that Section; (c) the examination requirement for new Notaries set forth in 26 V.S.A. § 5341(b)(5) and the continuing education requirement for renewal Notary applicants set forth in 26 V.S.A. § 5343(b) takes effect on February 1, 2021 and applies to those applicants for the commission terms that begin on that date.
Analysis

Vermont has modernized its outdated Notary laws with the enactment of House Bill 526. HB 526 enacts substantive portions of the Revised Uniform Law on Notarial Acts and supplements it with Vermont-specific provisions. The standards for notarial acts and electronic acts are certainly welcome, as is the requirement that Notaries take continuing education beginning in 2021. An official stamp is required unless a Notary chooses to clearly print or type the Notary’s name and commission number on each notarial certificate. Along the way, the Secretary of State had to give up a journal requirement and create carve-outs for many Notaries who work in government offices in the state. Notwithstanding these concessions, HB 526 will bring welcome change and significantly increase the integrity and stature of the Notary Public office in Vermont.

Read House Bill 526.

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