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Sample State Laws Addressing Professional Conflict Of Interest

Final-Beneficial-Interest(Originally published in the November 2019 issue of The National Notary magazine.)

Some states directly address unusual professional conflict of interest situations for Notaries in their statutes. Here are a few notable examples. More information on conflict of interest laws in other states is available at the NNA’s State Law Summaries page.

CALIFORNIA

California law provides an exception to disqualifying interest for Notaries also acting as agents, employees, insurers, attorneys, escrow officers and lenders on behalf of a person with a financial or beneficial interest in a document. A Notary acting in one of these capacities is permitted to notarize the signature of a client the Notary represents (GC 8224).

FLORIDA

Notaries may notarize signatures for their employer without being disqualified, provided that the Notary receives no benefits other than their salary and the statutory notarization fee (FS 117.107[12]).

Florida Notaries who are attorneys may notarize a signature of a client without conflict of interest as long as the attorney has no interest in the document other than the fee paid by the client for legal services and the statutory Notary fee (FS 117.107[12]).

MAINE

A Notary employed by or serving as an officer of a petition organization or as a treasurer, principal officer, primary fundraiser or primary decision maker to a ballot question committee or performing any services other than notarizing for such organizations may not notarize or certify an election petition. In addition, a Notary may not notarize if they are employed or compensated by a petition organization for any purpose other than notarial acts, provides services or offers assistance to a ballot question committee influencing a ballot measure or is employed by or receives compensation from the ballot question committee for any purpose other than performing notarial acts (21-A MRSA 902 and 903-D[1]).

MINNESOTA

A person named as a health care agent or alternative agent for a health care power of attorney document may not notarize a principal’s signature on the same health care power of attorney. An employee of a health care organization providing care to a patient may notarize the patient’s signature on a health care directive, provided the employee is not named in the document as a health care agent or alternative agent (MS 145C.03, subdivision 3).

NEBRASKA

State law permits exceptions to disqualifying interest rules in the following situations:

• An attorney; an employer or associate of an attorney; or a stockholder, officer or employee of a professional law corporation who is a Notary may notarize for the professional activities of that attorney or corporation (RSN 64-211[1]).

• A real estate agent or broker, or an employee or associate of such who is a Notary, may notarize for clients (RSN 64-211[2]).

• An employee, member, shareholder, officer, agent or director of an insurance company, cooperative credit association or credit union who is a Notary may notarize for the company, association or union (RSN 64-212 and 64-213).

• A stockholder, officer or director of a bank who is a Notary may notarize for the bank (RSN 64-214).

• An employee, shareholder, director, agent or officer of a savings and loan association or industrial loan and investment company who is a Notary may notarize for the association or company (RSN 64-215).

PENNSYLVANIA

Notaries may not take an acknowledgment on a power of attorney if the Notary is named as an agent in the power of attorney document or serves as a witness to the signing of the document. In addition, an attorney who is a Notary may take the acknowledgment provided the attorney is not one of the witnesses to the power of attorney (20 Pa.C.S. 5601[b][3]).

A Notary who is an officer, director or employee of a company that is a party to a notarized transaction may notarize for a transaction involving the company, unless the Notary personally benefits from the transaction other than receiving a fee that is not contingent on the completion of the notarized transaction. A Notary who is a shareholder in a publicly traded company may notarize when the company is named as a party to the notarized transaction (57 Pa.C.S. 304[a][2]).

TEXAS

Texas allows employees of corporations to notarize an acknowledgment or proof of a written document in which the employee's corporation has an interest. Texas also permits a corporation shareholder to notarize corporate documents unless the corporation has 1,000 or fewer shareholders and the Notary owns more than one-tenth of one percent of the corporation's issued and outstanding stock (Civil Practices and Remedies Code 121.002). Texas Notaries are not disqualified from notarizing solely on the basis of the Notary owning stock in certain trust institutions that are an interested party in the transaction (Texas Finance Code 199.002).

David Thun is an Associate Editor at the National Notary Association.

 

 

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