RAPID ADVANCES IN ONLINE COMMUNICATION and
electronic signing technology are changing the way
notarizations are performed. These changes have sparked a spirited discussion among trade associations, business leaders, Notary regulators, legal experts, technologists and policymakers across the country on how to regulate notarial acts that use this new technology.
As a leading education and support provider for Notaries, the National Notary Association recognized that it was crucial to provide clear support and guidance to policymakers addressing this issue while preserving the integrity and security of notarial acts. Consequently, the NNA has published a resource to guide and inform lawmakers trying to integrate new technologies into the notarization process. The result is the Model Electronic Notarization Act of 2017. What is the Model Electronic Notarization Act? The Model Electronic Notarization Act (MENA) is a comprehensive standard and guide for public officials looking to draft new laws or administrative rules governing the notarization of electronic records. It is the fifth model act published and contributed to the public domain by the NNA, but the first one devoted exclusively to electronic notarization. The primary intended purpose of the MENA is to allow a U.S. state or jurisdiction to enact progressive electronic notarization provisions alongside its existing paperbased Notary statutes to form an integrated, single system for both electronic and paper-based notarial acts. Drafted by the NNA, the MENA was reviewed by a diverse panel of state officials, legal scholars, law enforcement professionals, technology providers, industry leaders and Notaries. The Act includes a wealth of information to support the Act’s policy goals. It includes a detailed legal commentary, written by Malcolm L. Morris, Dean of John Marshall Law School in Atlanta, Georgia, explaining each of the Act’s positions. In addition, several appendices provide background on verifying identity online, a detailed history of electronic notarization laws dating back to the mid-1990s and model rules to implement the Act’s provisions in an administrative rule framework. “The MENA is the go-to resource for electronic notarization laws and rules,” said Bill Anderson, MENA Drafting Co-Coordinator and NNA Vice President of Government Affairs. “Every policymaker considering eNotarization should consult the MENA to review all policy options.” The MENA itself is not a binding law. To become law, it must be introduced and enacted in state legislatures, adopted by a Notary commissioning official as administrative rules or put into effect by gubernatorial executive order. In fact, prior versions of the NNA’s model acts have become law in all these ways.
As with all the NNA’s prior model acts, lawmakers may choose to include all or part of the MENA when enacting laws or adopting administrative rules. How Does the MENA Help Notaries? At the most basic level, the MENA was drafted with a firm conviction that the involvement of a Notary in electronic transactions is necessary to make those transactions more secure and trustworthy. One of MENA’s primary goals is ensuring that any new laws incorporating technology into the notarial process are clearly worded and understandable by the Notaries who must read and abide by them. The Act’s provisions are designed to ensure that Notaries can fulfill their traditional role regardless of the technology being used, be it an ink pen and physical Notary seal or an electronic signature and webcam. “The MENA provides state lawmakers with a well conceived model for remote electronic notarization that protects all involved parties — document signers, persons relying on a remotely notarized document, and Notaries themselves,” said Charles N. Faerber, MENA Drafting Committee Co-Coordinator. The Act contains several provisions specifically designed to protect Notaries. Notaries may refuse a request for an electronic notarization for several reasons, one being the poor quality of the audio-video transmission in a remote electronic notarization. In addition, the Act created a new protection absolving the Notary of any liability in using an electronic notarization system if the system fails to comply with the requirements of the Act. Both the model statute and recommended rules are written in such a way as to be flexible enough to apply to future technologies. That is a crucial element of the MENA because it is intended to make sure Notaries and the notarial act remain relevant and vital to our daily transactions. So many state laws and Notary rules are embedded in the practices of past centuries. But the advances of technology are rendering those practices less effective and more obsolete. And a growing number of states are recognizing the need to update their laws. Given that more than two dozen states and U.S. territories have adopted provisions from the NNA’s previous model acts, the MENA could help shape how Notaries will use technology to protect 21st century commerce. MENA and Webcam Notarization One of the most significant discussions among the “The MENA is the go-to resource for electronic notarization laws and rules.” — Bill Anderson, MENA Drafting Coordinator
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drafting committee and reviewers involved webcam notarization. “The greatest challenge faced by the MENA drafting committee was deciding whether the Act should ignore, outlaw, legitimize or strictly condition so-called remote electronic notarizations,” Faerber said. The committee decided that such notarizations are advisable and in the
public interest — but only when they are governed by rigorous rules. In view of the growing interest in webcam notarization, it became clear that the MENA had to address it with provisions to protect both Notaries and members of the public who rely on the integrity of audio-visual electronic notarizations. This is particularly true given that half a dozen states — including Texas and Maryland — are considering webcam notarization bills during their current legislative sessions.
Consequently, Chapter 5 of the MENA allows the use of audio-video technology to communicate with a signer, including the following requirements: • Remote audio-video communication should only be used for electronic notarizations, not for notarization of paper documents. (It should be noted that this recommended requirement is included in established webcam notarization laws in Virginia, but not in Montana). • The Notary must archive and protect a recording of the notarization and provide access to the recording to the public, state officials or law enforcement. • The Notary must still verify the identity of the signer and any required witnesses through appropriate proof of identity. • The Notary, principal signer and any required witnesses must access the audio-video system through an authentication procedure that is reasonably protected from unauthorized access.
• The notarization must provide reasonable certainty that the Notary and all participants are viewing the same electronic document and any changes or signatures are made in real time. • Any Notary who performs a notarization using audio-visual communication must have a minimum surety bond of $25,000 to protect signers from financial damages in addition to any Notary bond they have for their Notary commission. eNotarization and Electronic Journals The MENA also updates model language for electronic notarization to address standards for computer systems and software used to perform electronic notarizations, or “eNotarizations.” Some states, such as North Carolina, require vendors of eNotarization systems to apply for state approval and have their systems approved by the state Notary regulating agency. The MENA proposes an alternate approach in its model language. Instead of vendors having systems reviewed and approved individually by a state agency, MENA suggests a list of standardized requirements that any eNotarization system can be required to meet. This would simplify and streamline the process of ensuring eNotarization technology meets minimum standards of security and privacy. The MENA also updates standards for electronic journals. Notaries have often asked if they can use an electronic journal in lieu of a traditional, permanently-bound paper journal. The MENA answers in the affirmative and provides the following requirements: • The electronic journal must be accessed through a password or other secure means of authentication; • The electronic journal must be tamper-evident (that is, display evidence of any change to a journal entry); • The Notary must create a duplicate record as backup, in the event of the original electronic journal being lost, damaged or destroyed; • The electronic journal must be capable of saving an electronic signature or other biometric identifier such as a retina scan, fingerprint or voiceprint; and • The electronic journal must be capable of providing tangible or electronic copies of any entry made in the journal. Though under the MENA a Notary may use an electronic journal for both electronic or paper-based notarizations, or both, the current legislative trend has been to limit electronic journals to electronic notarizations. “There aren’t many states enacting electronic journal laws for traditional pen and paper notarizations,” Anderson said. “Some states have wanted a journal requirement for paper-based notarizations, but when the bills are introduced, there is pushback from people who oppose journals. A common compromise has been to require journals only for electronic notarizations.” Working with the MENA U.S. states and jurisdictions have a variety of ways to use the MENA. First, the Act can be enacted either as a “plugin” update or complete replacement of a state’s electronic notarization statutes. Second, lawmakers can choose to enact select portions of the MENA and leave out sections (such as the chapter on webcam electronic notarizations) that they are not ready to integrate or that they prefer not to include. Finally, for those states that prefer to enact the Revised Uniform Law on Notarial Acts (RULONA) (see article, right) instead of the MENA, an appendix in the MENA provides a model for using the MENA provisions as the source for administrative rules to implement the RULONA provisions on electronic notarization. The MENA provides something for every U.S. state and jurisdiction that seeks to modernize their Notary laws while ensure the integrity of the notarial process.