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Remote Notary Services Get A (Temporary) Green Light in New Jersey

The days of physical closings for complex business transactions with everyone on both sides of the transaction gathered in a single conference room in front of stacks of documents feverishly signing multiple copies (and inevitably overlooking something) seem like ancient history now. The passage of the federal Electronic Signatures in Global and National Commerce Act (ESIGN) and the subsequent nearly-universal adoption of the Uniform Electronic Transactions Act gave the green-light to the use of electronic signatures. While the practice of “remote closings” did not spring into wide use immediately following the adoption of these laws, it is now by far the most common way for deals to get closed.

Remote Notary Services

The one persistent exception to this was for transactions that required one or more of the documents to be notarized, most often in the context of real estate conveyances. Any such document needed to be signed in the physical presence of a notary or, at least in New Jersey, an attorney admitted to practice in New Jersey.

During the current COVID-19 pandemic, what had previously been just a minor inconvenience became a major headache. Many bank branches where a notary was typically present to provide those services are now closed. Many attorneys are working from home, as are the persons expected to sign the document or documents in question. In response, on April 13, 2020, the New Jersey Legislature sent Governor Murphy Assembly Bill No. 3903. The Governor signed the bill the following day and it is now law.

What Applies?

The new law allows public notaries and New Jersey attorneys to notarize documents for remotely-located individuals provided a number of requirements are satisfied:

  • Satisfactory Evidence of Identity. For individuals not personally known to the notary or attorney, there needs to be “satisfactory evidence” of identity, typically a passport or driver’s license or other “identity proofing” provided by a third party.

  • Reasonable Confirmation of Identical Record. The notary or attorney must reasonably confirm that the document being notarized is the same one that was signed.

  • Technology Requirements. The goal is for individuals to sign documents at home or any other location with suitable hardware and connectivity. The notary or attorney must be able to watch through Facetime, Zoom, or other video services that allow for recording. The notary or attorney must create a recording of the signing and save the recording for ten years.

  • Special Annotation. The documents will need to contain an annotation that the notarization was done remotely.

There are additional requirements for individuals who are located outside of the United States at the time of signing.

What Does Not Apply?

The new procedures do not apply to certain documents that are governed by the Uniform Commercial Code, or for any matter relating to adoption, divorce, or other matters of family law. The State Treasurer is also authorized to adopt emergency regulations, which are expected to track standards adopted by the Mortgage Industry Standards Maintenance Organization and the National Association of Secretaries of State.

The law expires when Governor Murphy’s Executive Order No. 103 is rescinded. But like so much of what has become the “new normal,” it remains to be seen whether these new procedures will become sufficiently popular and reliable to put one more nail in the in-person live closing’s coffin.

©2020 Norris McLaughlin P.A., All Rights ReservedNational Law Review, Volume X, Number 107
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About this Author

James H. Laskey Corporate Business Attorney Norris  McLaughlin Law Firm New Jersey
Member

James H. Laskey is past Chair of the firm’s Business Law Group. His business practice is primarily transactional in nature, including mergers, acquisitions, licensing agreements for life science and technology companies, and product supply and distribution arrangements, especially for consumer products and manufacturing companies.

In addition to his business practice, Jim maintains a practice in administrative and government regulatory law, including public utility, telecommunications, energy, and antitrust issues. For more than ten years, he...

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