April 1, 2020 — (As published on Law360) — Among all the government remedies, extensions, trillion-dollar stimulus packages and other pandemic-relief actions being proposed, allowing virtual notaries — as senators on both sides of the aisle have proposed — might not seem like a very significant cause.
It is crucially important, however, and here’s why.
Our economy recently, suddenly was thrust into a recession that could turn into a depression as our economy grinds to a halt under the COVID-19 tsunami. Depending on when those tides recede, within the next several weeks or just the next few weeks, the president has indicated he will push America to get back to business.
But regardless of what he dictates, what actions he takes, or how he approaches it, as the numbers of new cases and associated deaths continue to mount, this terrible pandemic will keep many of us fearful of the virus and, as a result, also fearful of being exposed to it by friends, relatives, coworkers or strangers.
Therefore, what we will need to get us get back to business won’t be merely government decrees limiting stay-at-home orders or our bosses telling us it’s time to return to work, but also the removal of any impediments to conducting business transactions virtually.
That’s why U.S. Sens. Mark R. Warner, D-Va., and Kevin Cramer, R-N.D., have introduced S. 3533, a bill better known as the Securing and Enabling Commerce Using Remote and Electronic Notarization Act.
“Americans shouldn’t have to risk their health or safety to execute important financial or legal documents, especially when they could do so from the safety of their own home,” said Cramer in a March 19 press release. “The SECURE Notarization Act brings the notary process into the 21st century, allowing people to securely complete documents while still following recommended health and social practices amid the coronavirus pandemic.”
If you want to get a sense of who will really be helped by any kind of bill, legislation or voter proposition, look to its backers. In this case, the SECURE Notarization Act is endorsed by the American Land Title Association, Mortgage Bankers Association and the National Association of Realtors. In a nutshell, the legal, real estate, banking, mortgage and finance communities, and the American people that they serve, all need this change, and now.
Swift changes like those proposed make you wonder why our country hasn’t already abandoned the archaic practice of insisting that important legal documents be notarized by an individual whose entire role is merely to physically visit the party signing the document, review and log their identification, have then sign their notarial book, and stamp the document confirming that these steps have been completed.
After all, immediately after we were all asked to work from home or shelter in place, the first thing many of us did was install or upgrade video conferencing software, such as Zoom, on our smartphones or computers.
Meditate on that for a minute. We increasingly file our tax returns digitally. Legal documents, medical examinations and schools are all going digital. Our entertainment choices are ever-increasingly digital. We have technology that enables you to have a super-sharp video conference on your laptop, tablet or smartphone with 100 people at once. But you can’t sign certain documents without a stranger visiting your home or workplace to make sure you’re you? Why didn’t we do this years ago?
I guess some habits, especially those that have been around for decades or even centuries, just don’t get forced out of our systems and processes until it really makes no sense to do them anymore. That’s the simplest take on why we haven’t done this before — the need wasn’t nearly as compelling — and why we need to do it now.
And there is an irony to this sudden need as well, in that, as I’m hearing from the estate planners with whom we co-counsel on our trust and probate estate litigation matters, there has been a sudden surge in Americans demanding access to virtual estate planning due to coronavirus concerns.
A central component of many estate planners‘ processes and, depending on your state laws, local legal requirements, includes having client signatures notarized to protect against further collateral attack from claims of fraud, undue influence or incapacity.
And those Americans who are most susceptible to the virus and most impacted by its potentially fatal end — the infirmed and elderly who most were most likely to be housebound even before the virus — logically, are the same people who would be most fearful of infection by a stranger visiting their home, such as a notary public who comes over to notarize their signatures on their wills, trusts, powers of attorney and/or advanced health care directives.
So a big reason why this legislation is a no-brainer, especially right now, is that it should help most those who historically have had and currently have the least access to services, those who not only would be most burdened by having someone come to their home, or by having to leave their home to visit a notary, but by those whose lives literally could be threatened by having to go through such a cumbersome and unnecessary process.
Of course critics will counter with concerns of fraud and manipulation, but those concerns exist in the current system, where in-person notaries are duped by ill-intentioned family members, caregivers and other interlopers. These concerns cannot be eliminated regardless of the process. What’s more, today’s technology affords protections, visibility and transparency, and ease of use that was not available previously, as we know from some states’ use of these technologies.
“Virginia has safely and securely allowed the use of remote notarizations for years,” said Sen. Warner. “At a time when most people should be staying at home, there’s no reason anyone should have to leave just to get notary services.”
Are there downsides? Of course. As this bill gives business to tech companies capable of meeting its requirements for tamper-evident technology and fraud prevention through multifactor authentication, it could take business away from smaller, mom-and-pop notary businesses whose tools of the trade area stamp pad and ledger. But this is always the case, when modernizing technologies make existing technologies and processes obsolete. Just ask the blacksmith about the Model T.
While it’s unfortunate to see any business shifted away from any mom and pop, the reality is that this change was coming. That eventuality is unavoidable. But when you balance that impact against the threat to the very lives of our moms and pops that these avoidable visits pose, for my taste, the government can’t enact this bill soon enough.
Scott Rahn is the founding and managing partner at RMO LLP.