[House Hearing, 109 Congress]
[From the U.S. Government Publishing Office]


 
  TO REQUIRE ANY FEDERAL OR STATE COURT TO RECOGNIZE ANY NOTARIZATION 
MADE BY A NOTARY PUBLIC LICENSED BY A STATE OTHER THAN THE STATE WHERE 
   THE COURT IS LOCATED WHEN SUCH NOTARIZATION OCCURS IN OR AFFECTS 
                          INTERSTATE COMMERCE

=======================================================================

                                HEARING

                               BEFORE THE

                 SUBCOMMITTEE ON COURTS, THE INTERNET,
                       AND INTELLECTUAL PROPERTY

                                 OF THE

                       COMMITTEE ON THE JUDICIARY
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED NINTH CONGRESS

                             SECOND SESSION

                                   ON

                               H.R. 1458

                               __________

                             MARCH 9, 2006

                               __________

                           Serial No. 109-89

                               __________

         Printed for the use of the Committee on the Judiciary


      Available via the World Wide Web: http://judiciary.house.gov


                                 ______

                    U.S. GOVERNMENT PRINTING OFFICE
26-412                      WASHINGTON : 2006
_____________________________________________________________________________
For Sale by the Superintendent of Documents, U.S. Government Printing Office
Internet: bookstore.gpo.gov  Phone: toll free (866) 512-1800; (202) 512ï¿½091800  
Fax: (202) 512ï¿½092250 Mail: Stop SSOP, Washington, DC 20402ï¿½090001

                       COMMITTEE ON THE JUDICIARY

            F. JAMES SENSENBRENNER, Jr., Wisconsin, Chairman
HENRY J. HYDE, Illinois              JOHN CONYERS, Jr., Michigan
HOWARD COBLE, North Carolina         HOWARD L. BERMAN, California
LAMAR SMITH, Texas                   RICK BOUCHER, Virginia
ELTON GALLEGLY, California           JERROLD NADLER, New York
BOB GOODLATTE, Virginia              ROBERT C. SCOTT, Virginia
STEVE CHABOT, Ohio                   MELVIN L. WATT, North Carolina
DANIEL E. LUNGREN, California        ZOE LOFGREN, California
WILLIAM L. JENKINS, Tennessee        SHEILA JACKSON LEE, Texas
CHRIS CANNON, Utah                   MAXINE WATERS, California
SPENCER BACHUS, Alabama              MARTIN T. MEEHAN, Massachusetts
BOB INGLIS, South Carolina           WILLIAM D. DELAHUNT, Massachusetts
JOHN N. HOSTETTLER, Indiana          ROBERT WEXLER, Florida
MARK GREEN, Wisconsin                ANTHONY D. WEINER, New York
RIC KELLER, Florida                  ADAM B. SCHIFF, California
DARRELL ISSA, California             LINDA T. SANCHEZ, California
JEFF FLAKE, Arizona                  CHRIS VAN HOLLEN, Maryland
MIKE PENCE, Indiana                  DEBBIE WASSERMAN SCHULTZ, Florida
J. RANDY FORBES, Virginia
STEVE KING, Iowa
TOM FEENEY, Florida
TRENT FRANKS, Arizona
LOUIE GOHMERT, Texas

             Philip G. Kiko, General Counsel-Chief of Staff
               Perry H. Apelbaum, Minority Chief Counsel
                                 ------                                

    Subcommittee on Courts, the Internet, and Intellectual Property

                      LAMAR SMITH, Texas, Chairman

HENRY J. HYDE, Illinois              HOWARD L. BERMAN, California
ELTON GALLEGLY, California           JOHN CONYERS, Jr., Michigan
BOB GOODLATTE, Virginia              RICK BOUCHER, Virginia
WILLIAM L. JENKINS, Tennessee        ZOE LOFGREN, California
SPENCER BACHUS, Alabama              MAXINE WATERS, California
BOB INGLIS, South Carolina           MARTIN T. MEEHAN, Massachusetts
RIC KELLER, Florida                  ROBERT WEXLER, Florida
DARRELL ISSA, California             ANTHONY D. WEINER, New York
CHRIS CANNON, Utah                   ADAM B. SCHIFF, California
MIKE PENCE, Indiana                  LINDA T. SANCHEZ, California
J. RANDY FORBES, Virginia

                     Blaine Merritt, Chief Counsel

                         David Whitney, Counsel

                          Joe Keeley, Counsel

                          Ryan Visco, Counsel

                    Shanna Winters, Minority Counsel


                            C O N T E N T S

                              ----------                              

                             MARCH 9, 2006

                           OPENING STATEMENT

                                                                   Page
The Honorable Lamar Smith, a Representative in Congress from the 
  State of Texas, and Chairman, Subcommittee on Courts, the 
  Internet, and Intellectual Property............................     1
The Honorable Howard L. Berman, a Representative in Congress from 
  the State of California, and Ranking Member, Subcommittee on 
  Courts, the Internet, and Intellectual Property................     2
The Honorable Darrell Issa, a Representative in Congress from the 
  State of California, and Member, Subcommittee on Courts, the 
  Internet, and Intellectual Property............................     3

                               WITNESSES

Timothy S. Reiniger, Esq., Executive Director, National Notary 
  Association
  Oral Testimony.................................................     4
  Prepared Statement.............................................     6
Malcolm L. Morris, Esq., Professor and Associate Dean, College of 
  Law, Northern Illinois University
  Oral Testimony.................................................     8
  Prepared Statement.............................................    10
Dean M. Googasian, Esq., The Googasian Firm, P.C.
  Oral Testimony.................................................    11
  Prepared Statement.............................................    14
Mr. Michael Frank Turner, Owner, Freedom Court Reporting, Inc.
  Oral Testimony.................................................    27
  Prepared Statement.............................................    28

                                APPENDIX
               Material Submitted for the Hearing Record

Prepared Statement of the Honorable Howard L. Berman, a 
  Representative in Congress from the State of California, and 
  Ranking Member, Subcommittee on Courts, the Internet, and 
  Intellectual Property..........................................    37


  TO REQUIRE ANY FEDERAL OR STATE COURT TO RECOGNIZE ANY NOTARIZATION 
MADE BY A NOTARY PUBLIC LICENSED BY A STATE OTHER THAN THE STATE WHERE 
   THE COURT IS LOCATED WHEN SUCH NOTARIZATION OCCURS IN OR AFFECTS 
                          INTERSTATE COMMERCE

                              ----------                              


                        THURSDAY, MARCH 9, 2006

                  House of Representatives,
              Subcommittee on Courts, the Internet,
                         and Intellectual Property,
                                Committee on the Judiciary,
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 10:07 a.m., in 
Room 2141, Rayburn House Office Building, the Honorable Lamar 
Smith (Chairman of the Subcommittee) presiding.
    Mr. Smith. The Committee on Courts, the Internet, and 
Intellectual Property will come to order.
    I'm going to recognize Members for opening statements, and 
then we'll get to our witnesses' testimony as quickly as we 
can.
    This morning the Subcommittee will venture into 
unchartered, but hopefully not shark-infested waters. Frankly, 
I cannot recall this Committee ever reviewing the Notary 
profession or how its members operate.
    The reason is that notaries are licensed by the individual 
States, not the Federal Government. But our colleague and 
friend from Alabama, Representative Aderholt, introduced a bill 
that is the subject of our hearing.
    His interest stems from a complaint registered by one of 
his constituents, who will testify as one of our witnesses 
today.
    For the record, a Notary Public administers oaths and 
serves as an impartial witness when documents are signed. Many 
States require that certain documents, such as affidavits, 
deeds, and powers of attorney, be notarized before they become 
legally binding on parties.
    In this respect, notaries are important participants in 
many legal and commercial transactions.
    Since the point of legal notarization is to deter fraud, a 
notary must positively identify the signatory to a document and 
ensure that he or she signs the document knowingly and 
willingly.
    A notary typically affixes his or her signature as well as 
an official seal to the document as further testament to its 
authenticity.
    Most States require an individual wishing to become a 
notary to submit an application, pay a fee, and take an oath of 
office. Many States also require an applicant to enroll in an 
educational course, pass an examination, and obtain a notary 
bond.
    So what does Congress have to do with notary operations?
    Legal disputes, Federal as well as State, are not always 
confined to the geographic and judicial domains of a single 
State. Much of our country's litigation crosses State lines.
    The reason we are reviewing H.R. 1458 is that lawfully 
notarized documents in one State may not always be acknowledged 
in another State.
    The Subcommittee needs to investigate the extent to which 
this is a genuine problem that requires a Federal legislative 
response. We must also determine if it is appropriate to act 
given 10th Amendment sensitivities and the concern for States' 
Rights.
    We have a good panel of witnesses today who can help the 
Subcommittee better understand the underlying subject matter 
and answer these questions.
    That concludes my opening statement, and the gentleman from 
California, Mr. Berman, is recognized for his opening 
statement.
    Mr. Berman. Thank you very much, Mr. Chairman. Although the 
topic of notary recognition between the States isn't 
necessarily the most exciting issue, it's an extremely 
practical one, and so I'm looking forward to hearing the 
witnesses' testimony.
    Notaries are involved in many aspects of legal and 
commercial transactions, from trusts in the States to real 
estate.
    Currently, each individual State creates its own laws to 
regulate the notary profession.
    H.R. 1458 has been introduced in an attempt to unify and 
standardize the acceptance of out-of-State notarial acts by 
State and Federal courts. There have been past attempts at 
unifying the requirements for notarial acts; some made by the 
National Notary Association, others made by the National 
Conference of Commissioners on Uniform State Laws.
    Over the course of 3 decades, legislators and notary 
regulating officials have borrowed from these models in 
reforming State and territorial notary laws on inconsistent 
basis.
    In some cases, only a few sections were adopted into 
statute. In others, the model was virtually--was enacted 
virtually in its entirety.
    Fourteen fifty eight would require each Federal or State 
court to recognize out-of-State notarial acts under the 
following two conditions: First, where such notarization occurs 
in or affects interstate commerce; and secondly, if a seal of 
the notary public's authority is used in the notarization; or 
in the case of an electronic record, the seal information is 
logically associated with the electronic record so as to render 
the record tamper resistant.
    Does the bill raise any constitutional issues? For example, 
does the bill's language violate the 10th Amendment, which 
disallows the Federal Government's encroachment upon the 
States' reserve powers or would the concept of full faith and 
credit apply?
    I look forward to hearing what specific situations the bill 
is trying to address, how prevalent the problem is out of out-
of-State notarial recognition and how the witnesses will 
address the States' Rights issues touched on by this bill, such 
as the relevance and applicability of the 10th Amendment and 
the full faith and credit clause. I yield back, Mr. Chairman.
    Mr. Smith. Thank you, Mr. Berman. The gentleman from 
California, Mr. Issa, is recognized, and I want to point out 
that Mr. Issa, after the Chairman and the Ranking Member, has 
the best attendance record of any other Member of this 
Subcommittee. Mr. Issa?
    Mr. Issa. Thank you, Mr. Chairman. And I will thank you for 
holding this hearing today. Some people might think that this 
is not the most exciting issue. And they'd be right.
    However, life experience leads me to realize this is an 
important issue. As somebody in business for more than 20 
years, I discovered that one State asks for a seal, while 
another State doesn't recognize seals. If you happen to be in a 
State that doesn't have a seal and you go to another State, and 
they say, where's your corporate seal, you have to go make a 
corporate seal, even though your own State doesn't have them. 
That sort of inconsistency in commerce in this day and age is 
unbelievable. But more so, the idea that one State would not 
recognize a notary public's signature while, in fact, and I'll 
be brief, my own life experience shows that more than 25 years 
ago, when I had to prove that I was the grandson of a landowner 
in Lebanon, I simply had to get a notarized copy of the death 
certificate of my father and my birth certificate, go and have 
it certified by the county as notarized, and since I went to 
the county that I could do those both by going to two windows. 
I then went to a counsel general, who kept copies of all the 
signatures of all the counties' clerks to verify that that was 
within my State a proper signature, which allowed me to go to 
Lebanon and have my documents recognized.
    If a quarter of a century ago, a miniscule country of less 
than 3 million people could have a system for recognizing the 
notary public in the county of Cuyahoga in the State of Ohio, 
it is unbelievable that among the 50 States we cannot have an 
equally effective system without congressional action. Since 
it's obvious that we can't, I look forward to this hearing and 
the passage of the bill.
    I yield back.
    Mr. Smith. Thank you, Mr. Issa. That's a particularly 
interesting personal story that I hadn't heard before, so--and 
it--it does impact on the subject at hand, too.
    I'd like to invite our witnesses to stand and be sworn in 
and then we'll get to your testimony.
    If you'll raise your right hand.
    [Witnesses sworn.]
    Mr. Smith. Please be seated.
    Our first witness is Tim Reiniger, who is Vice President 
and Executive Director of the National Notary Association. Mr. 
Reiniger is an attorney who has litigated commercial disputes 
for more than 10 years. He is also a fellow public official, 
having served as an alderman in Manchester, New Hampshire.
    Mr. Reiniger earned his bachelor's degree cum laude from 
Georgetown University and his law degree from the University of 
Michigan.
    Our next witness is Malcolm Morris, Associate Dean and 
Professor of Law at Northern Illinois University. Professor 
Morris teaches Federal taxation, property and trusts, and 
estates. He has written numerous law review articles and 
practitioner-oriented works, including Notary Law and Practice: 
Cases and Materials.
    Professor Morris earned his B.S. from Cornell University, a 
J.D. from the State University of New York at Buffalo, and an 
L.L.M. from Northwestern University.
    Our third western--excuse me--third witness is Dean 
Googasian, a trial lawyer from Bloomfield Hills, Michigan.
    Before entering private practice, Mr. Googasian clerked for 
a member of the Michigan Supreme Court and worked for the U.S. 
Department of Justice. He did his undergraduate work at the 
University of Michigan and later graduated first in his class 
from Wayne State University Law School.
    Our final witness is Mike Turner, the owner of Freedom 
Court Reporting in Birmingham, Alabama, the largest reporting 
company in the State. He has 30 years of experience as a notary 
and court reporter and frequently travels out of State to 
conduct business.
    Mr. Turner was educated at the University of Alabama at 
Birmingham and Lipper's Court Reporting College in Plainview, 
Texas. That gives you extra status today.
    Welcome to you all. We have your entire statements and 
without objection, they will be made a part of the record. And, 
Mr. Reiniger, we'll begin with you.

  TESTIMONY OF TIMOTHY S. REINIGER, ESQ., EXECUTIVE DIRECTOR, 
                  NATIONAL NOTARY ASSOCIATION

    Mr. Reiniger. Thank you, Mr. Chairman, and honorable 
Representatives of the Committee.
    I am honored to be here today on behalf of the National 
Notary Association, which is the largest professional 
association for notaries public in the United States, with 
300,000 members. I'm also pleased to be here today with our 
Vice President of Notary Affairs and the nation's leading 
expert on notary matters and laws. That is Mr. Chuck Ferber, 
who's sitting behind me.
    This is indeed on the surface what appears to be--kind of a 
dry subject that's not normally discussed, but, in fact, is 
becoming a matter of central importance, particularly with 
respect to evidence and admissibility of records in court.
    Now, I do have written comments I will be submitting today, 
and I will submit those for the record. I'm going to address 
orally now just a few of the major points we see with respect 
to evidence.
    And, in fact, last December, the 9th Circuit Bankruptcy 
Court Panel in the American Express case issued an opinion with 
respect to electronic records and their admissibility--now, in 
that case not specifically notarized records.
    But it goes to the heart of our substitute language that we 
are submitting with respect to the electronic notary seals, and 
electronic documents. In the American Express case the 
electronic records were not authenticated. They were not 
allowed into evidence at all because of the lack of sufficient 
ability to prove their authenticity, their genuineness from the 
time they were created throughout the history of that record.
    Notarization at its heart is a means of proving the 
authenticity and genuineness of a document. As you all 
mentioned, the signer intentionally adopts the contents of the 
document as his or her act before the independent accountable 
witness, which is the notary.
    The seal is the physical evidence of the material act and 
the physical evidence proof of that individual's official 
character or status as a notary.
    Now, how does the notarization establish or prove the 
document's authenticity? In two ways: the notary verifies the 
identity of the signer and also verifies the content integrity 
or completeness.
    The rules of Federal evidence--of Federal Rules of Evidence 
and the most of the State rules of evidence also area based on 
this bedrock principle of authentication via the seal. However, 
these rules leave some gaps. They refer to seals on public 
documents, documents which have been acknowledged. And this has 
resulted in some uneven application in various States from our 
experience, including you will hear today from the State of 
Michigan, and that case concerning the affidavit.
    This bill, for the current paper world, would help to 
address that problem, to create a uniform recognition and 
application of documents for the notary seal for the purpose of 
admissibility. It does not speak to or require that the court 
enforce the document, but a prerequisite to enforcing the 
document is that it first be admissible in court, so that is 
the hurdle that this bill is addressing and that is the key 
reason we are supporting it.
    Now, this hurdle will become even more complicated, as I 
mentioned, with electronic documents, and how that authenticity 
is established.
    In the paper world, the notary seal is physically affixed 
to the document. The States set those requirements. The States 
determine the form of the seal, whether it should be affixed 
with an embossment or with a stamp or the typewritten words 
``notary public.''
    This bill does not, in any way, interfere with the ability 
or how the States will determine how the seal is affixed to the 
document. It merely sets a minimum standard, however, as to how 
these documents will be treated by a court for admissibility 
purposes, so it addresses the legal effect of the document and 
no way interferes with State rules for affixing seals or even 
commissioning notaries.
    A very key aspect is that, particularly for the electronic 
world, to preserve that same built-in test for authenticity 
that is given in the paper world by the seal, in the 
electronic. Because of the ease of making changes, alterations 
to the documents, it is essential that the notary seal be 
securely affixed to the document in such fashion that any 
changes are rendered detectable. This is absolutely essential 
for admissibility in court, to be able to test the authenticity 
of the document. This is a very important capability.
    So, again, the reasons for our support for the substitute 
bill is that one, this will preserve the ability of the 
notarization system as it currently exists, to provide 
integrity to commerce, both in paper and electronic forms.
    Mr. Smith. Okay. Mr. Reiniger, can you conclude your 
testimony, and you'll be able I suspect cover some of those 
same subjects during the question and answer period.
    Mr. Reiniger. Absolutely. And this bill will address the 
many current problems in the admissibility of notarized 
documents from State to State. Thank you.
    [The prepared statement of Mr. Reiniger follows:]

               Prepared Statement of Timothy S. Reiniger

    The National Notary Association, a non-profit professional 
organization serving the 4.5 million notaries public of the United 
States, is strongly in favor of the Substitute to H.R. 1458.
    This bill would require federal and state courts to admit into 
evidence any notarized document originating in another state, provided 
that document affects interstate commerce and the Notary's seal of 
office is affixed to it.
    Notaries, of course, constitute one of the nation's critical front 
lines of defense against forgery and other identity crimes, protecting 
the titles to our homes and other valuable property, as well as our 
rights to due process under law. Notaries screen document signers for 
identity, volition and basic awareness, thereby daily preventing a 
multitude of fraudulent acts, including those that might be committed 
to fund and support terrorist activities.

                `FULL FAITH AND CREDIT' DOCTRINE IGNORED

    You may not be aware that, despite the ``full faith and credit'' 
provision of the U.S. Constitution's Article IV, Section 1, lawfully 
notarized documents are often rejected when sent across state lines. 
The reasons for these rejections typically concern form and not 
substance.
    For example, a document notarized in State A may be rejected in 
State B because the acknowledgment certificate wording used in State A 
does not conform verbatim to that prescribed by statute or custom in 
State B, even though it conforms in substance.
    Another example: A document notarized in State A may be rejected in 
State B because State A by law requires notaries to use inking seals 
and State B by statute or custom requires embossers.
    Yet another example: A document notarized in State A may be 
rejected in State B because the latter state imposes special 
authentication rules beyond lawful notarization that State A may be 
unequipped to carry out.
    In almost every case, the cause of these document rejections is 
cosmetic and does not pertain to the propriety or substance of the 
notarial act itself.
    These frequent document rejections constitute a serious impediment 
to interstate commerce, and they impose appreciable costs on business 
and government.

              MODEL AND UNIFORM LAWS DO NOT SOLVE PROBLEM

    One way the National Notary Association has tried to solve the 
problem of these rejections is by creating, promulgating and updating a 
Model Notary Act for adoption by state legislatures, so that state 
notary laws across the nation might become more uniform. Although a 
number of states have enacted some or all of the provisions of the 
Model Notary Act in its updated forms--most recently Massachusetts, New 
Mexico and North Carolina--most states have not.
    Over the years, uniform laws have been created and promulgated by 
the National Conference of Commissioners on Uniform State Laws to 
recognize notarial acts performed in other states and jurisdictions of 
the United States. These acts are: the Uniform Acknowledgment Act of 
1939; the Uniform Recognition of Acknowledgments Act of 1968; and the 
Uniform Law on Notarial Acts of 1982, which was drafted to replace the 
two preceding acts.
    However, these uniform laws have not solved the rejection problem 
for three reasons. First, not all states have adopted these uniform 
laws; for example, only 11 states have adopted the Uniform Law on 
Notarial Acts of 1982. Second, the oldest of these uniform laws applies 
only to recognition of acknowledgment notarizations, and not to other 
notarial acts such as jurats. And third, none of the uniform laws deals 
with admissibility issues and rules for the evidentiary use of the 
notary seal.

                  NOTARY SEALS DETER AND REVEAL FRAUD

    The Substitute to H.R. 1458 would much more directly and 
effectively address the problem of notarized documents being rejected 
for form or technical reasons after crossing a state border. It would 
require federal and state courts to accept documents that have been 
lawfully notarized out of state, provided these documents involve 
interstate commerce and bear the seal of the notary.
    The seal, of course, is not only the distinguishing symbol of the 
notary public office in both the paper and electronic world, but it is 
also an effective fraud-deterrent device that, when adroitly used, can 
deter or reveal fraudulent addition or replacement of the pages in a 
paper document. In the case of electronic documents--and as provided in 
the Substitute to H.B. 1458--any electronic seal must likewise render 
the electronic document tamper-resistant, with the capability of making 
evident any unauthorized, fraudulent attempts to alter the document.

                     THE FEDERAL RULES OF EVIDENCE

    The notary public seal is critical when it comes to the 
admissibility of evidence. Authentication by seal is a bedrock 
evidentiary principle in the Federal Rules of Evidence (902 [1] and 
[2]) and in the many state laws they have inspired. These rules reflect 
the evidentiary principle of authentication by seal of a public officer 
as a condition precedent to that document's admissibility and 
entitlement to full faith and credit legal enforceability. It is 
recognized that the risk of forgery is reduced by the requirement of 
authentication by a public officer who possesses and affixes a seal. 
(See, Advisory Committee Note to FRE 902 [2].)
    Under the many state laws that mirror the Federal Rules of 
Evidence, documents under the seal of a public officer are generally 
considered self-authenticating. It has long been established that a 
notary is a public officer. See, for example, Pierce v. Indseth, (106 
US at 549; 1 SCt 418 [1883]), stating that notaries ``are officers 
recognized by the commercial law of the world.'' As a public officer, a 
notary affixes a seal and signature to authenticate a document without 
the need for extrinsic evidence to prove the seal and signature's 
genuineness or to confirm the notary's capacity.
    Seal use by notaries is near universal, with 44 out of 56 U.S. 
states and territorial jurisdictions by law requiring a physical 
imprint of an official seal--either an embosser, an inking stamp, or 
both. Eleven of the remaining 12 jurisdictions that do not impose a 
formal seal requirement nonetheless have a law such as New York's 
Executive Law (Section 137) requiring notaries to ``print, typewrite, 
or stamp'' such information as the notary's name, county, and 
commission expiration date on each document notarized--certainly a seal 
requirement in all but name.

                    NEW ERA OF ELECTRONIC DOCUMENTS

    Increasingly, there is a significant interstate dimension to the 
notarial system in the United States, especially in this new era of 
notarized electronic documents, when digital instruments may be 
instantaneously sent coast to coast at the touch of a computer key.
    In this new electronic era, Article IV, Section 1, of the U.S. 
Constitution has taken on a new significance when it says: ``Full faith 
and credit shall be given in each State to the public Acts, Records, 
and judicial Proceedings of every other State.'' Under our federal 
system, full faith and credit recognition by sister states and 
territories is obligatory, not discretionary, provided the public act, 
record, or judgment was lawful in the U.S. state or territory of 
origin. The official acts of all public officials--whether judges, 
county clerks, recorders of deeds, justices of the peace, or notaries--
are entitled to interstate recognition.
    This principle of full faith and credit was recognized in a noted 
1912 case (Nicholson v. Eureka Lumber, 160 NC 33; 75 SE 730 [NC 1912]), 
when North Carolina accepted a notarization lawfully performed in Texas 
by a female notary, at a time when that state did not allow women to 
serve as notaries.

                ONE EXAMPLE OF AN IMPEDIMENT TO COMMERCE

    In the experience of the National Notary Association, many of the 
4.5 million notaries of the United States are veterans of what have 
been described as frustrating and time-consuming ``coast-to-coast 
document ping-pong matches.'' In these interstate exchanges, a document 
notarized, let's say, in California may be sent for filing in Alabama, 
but an attorney or clerk in Alabama will then tear off the California 
notarial form, attach a blank Alabama form, and send it back to 
California with the note, ``Use this certificate.'' The notary, 
however, receiving the document a second time, will write a note back 
saying that California law obliges him or her to use only the notary 
form dictated by California statute. In this fashion, such a document 
may make three or four transcontinental trips, with accompanying phone 
calls and a hurried search for a new notary who will be less scrupulous 
about the wording of the certificates he or she notarizes.
    Indeed, in the early 1990s, the volume of such disruptive 
interstate standoffs caused the California Legislature to enact a law 
(Civil Code 1189[c]) stating that California notaries may use out-of-
state acknowledgment forms on documents to be filed out of state, but 
must use only California's statutory acknowledgment on documents filed 
in California.
    The Substitute to H.R. 1458 will lessen the need for such state 
laws, which should be seen as discomfiting evidence that the ``full 
faith and credit'' provision of our Constitution could use some help 
when it comes to interstate recognition of notarial acts.

                     ADDITIONAL PROPOSED AMENDMENTS

    To perfect this legislation, the National Notary Association does 
recommend several technical amendments. First, we recommend that the 
bill specify that only ``lawful'' notarizations be recognized by the 
federal or state courts. Second we recommend that the bill reflect the 
fact that while some states may ``license'' their notaries, as is the 
current term used in the bill, others may instead ``commission'' or 
``appoint'' them.
    (Accordingly, the following changes, underlined, to the Substitute 
to H.R. 1458 would result:

        Each Federal court shall recognize any lawful notarization made 
        by a notary public commissioned, appointed, or licensed under 
        the laws of a State other than the State where the Federal 
        court is located. . . .

        Each court that operates under the jurisdiction of a State 
        shall appoint any lawful notarization made by a notary public 
        commissioned, appointed, or licensed under the laws of a State 
        other than the State where the court is located. . . .)

                               CONCLUSION

    In conclusion, I urge your support of the Substitute to H.R. 1458 
as a major step in removing the serious impediment to interstate 
commerce caused by the frequent rejection of properly notarized 
documents for form or technical reasons--rejection that imposes 
appreciable delays and costs on business and government.

    Mr. Smith. Okay. Thank you, Mr. Reiniger. Mr. Morris?

 TESTIMONY OF MALCOLM L. MORRIS, ESQ., PROFESSOR AND ASSOCIATE 
       DEAN, COLLEGE OF LAW, NORTHERN ILLINOIS UNIVERSITY

    Mr. Morris. Thank you, Mr. Chairman and distinguished 
Committee Members, for allowing me to be here today to lend my 
support to H.R. 1458 and explain why it will prove valuable in 
promoting interstate commerce.
    The bill puts in place a simple principle: an official act, 
properly performed in one State deserves recognition it its 
sister States. I think that somewhat addresses the full faith 
and credit issues, which are in my written testimony.
    I am going to stay more on text, because to allow a 
professor to free wheel, we'll get nothing done in 5 minutes. 
So please bear with me.
    My support is based upon my view that this bill will help 
eliminate unnecessary impediments in handling the everyday 
transactions of individuals and businesses. Many documents 
executed and notarized in one State, either by design or 
happenstance, find their way into neighboring or more distant 
States.
    If ultimately needed in any one of the latter jurisdictions 
to support or defend the claim in court that document should 
not be refused admission solely on the ground it was not 
notarized in the State where the court sits. The bill seeks to 
ensure this would not happen.
    Significantly, H.R. 1458 includes electronic notarizations 
in its recognition regime. Doing so should be applauded. 
Congress enacted the Electronic Signatures and Global and 
National Commerce Act, E-sign, with an understanding of the 
important role electronic transactions were to play in both 
worldwide and national commerce. E-sign gave many electronic 
documents equal footing with their paper-based counterparts. It 
also recognized that electronic documents could be notarized. 
Parties using electronic documents generally do not anticipate 
face-to-face meetings with other parties in the transaction.
    Consequently, the need to have properly authenticated 
electronic documents is acute. Notaries public are armed with 
new technology to perform electronic notarizations equipped to 
meet this demand.
    This bill would provide that electronic notarizations 
receive the same interstate recognition it seeks to accord 
paper-based ones.
    Since many electronic documents travel over State borders, 
requiring that an electronic notarization be recognized 
irrespective of the State in which it was performed will help 
promote electronically based interstate commerce.
    Failure to do so could undercut important goals advanced by 
E-sign.
    Two items in the bill that I think might be considered for 
additional changes are as follows: One, in the first paragraph 
of both sections 1 and 2, the word--I recommend the word 
``lawful'' be added immediately before ``notarizations.'' We 
can--I can explain this in more depth during the question and 
answer period, but I feel by doing so, this would ensure State 
sovereignty insofar as notarial activities are concerned, which 
seems to be an issue that one of the gentlemen raised.
    I also suggest that the first paragraph of both sections 1 
and 2 have a housekeeping change in that in addition to the 
word ``license,'' the words--the word ``commissioned'' is 
added, since many States actually commission Notaries Publics 
and do not license them.
    Importantly, nothing in this bill, with the changes that I 
have suggested, would attempt to regulate Notaries Public or in 
any way detract from the individual States' authority to do so. 
The power to commission and sanction Notaries Public remains 
within the exclusive province of the State. The bill seeks only 
to give cross-border recognition to notarizations executed by 
those persons who have been conferred the authority to perform 
them under the States of their--under the statutes of their 
commissioning States.
    In sum, the bill addresses, with my recommended change, 
only the recognition of the notarial act and does not speak to 
the underlying authority that gives rise to that act.
    For the above reasons, I am pleased to add my support to 
this legislative initiative. The bill recognizes society has 
become more mobile. The number of people traveling from State 
to State has increased.
    Additionally, advances in computer systems and technology 
have made it easy for many businesses to operate in more than 
one State.
    Consequently, more and more documents are working their way 
into interstate commerce. People and businesses relying on 
notarized documents deserve assurances that the documents will 
be respected and the legal rights created by them properly 
protected. By mandating recognition of notarial acts performed 
in non-forum States, this bill takes a giant step toward that 
end.
    Thank you
    [The prepared statement of Mr. Morris follows:]

                Prepared Statement of Malcolm L. Morris

    It is my pleasure to be here today to add my voice in support of 
the substitute amendment to H.R. 1458 (dated 12/1/05). My understanding 
is that this Bill requires Federal and State courts to recognize 
notarial acts performed in the United States but outside of the courts' 
jurisdictional borders. More specifically, the Bill would require a 
Federal court to recognize a notarization performed in a State that was 
not within the territorial limits of the district or circuit in which 
that court sits. It also would require a State court to recognize a 
notarization performed in another State.
    My support is based upon my view that this Bill will help eliminate 
unnecessary impediments in handling the everyday transactions of 
individuals and businesses. Many documents executed and notarized in 
one State, either by design or happenstance, find their way into 
neighboring or more distant States. If ultimately needed in any one of 
the latter jurisdictions to support or defend a claim in court, that 
document should not be refused admission solely on the ground it was 
not notarized in the State where the court sits. This Bill seeks to 
ensure this would not happen.
    H.R. 1458 is quite sensible given what it seeks to accomplish. A 
notarization in and of itself neither validates a document nor speaks 
to the truthfulness or accuracy of its contents. The notarization 
serves a different function, viz, verifying that a document signer is 
who he or she purports to be and has willingly signed the document. 
Thus, it can be said that the notary public authenticates the document. 
By executing the notarial certificate, the notary public, as a 
disinterested party to the transaction, informs all other parties 
relying on or using the document that it is the act of the person who 
signed it. The presence of the official seal gives notice that the 
notary public acted under authority conferred to him or her by the 
State. Consistent with the vital significance of the notarial act, this 
Bill provides courts must accept the authenticity of the document even 
though the notarization was performed in a State other than where the 
forum is located.
    Significantly, H.R. 1458 includes electronic notarizations in its 
``recognition'' regime. Doing so should be applauded. Congress enacted 
the Electronic Signatures in Global and National Commerce Act (15 
U.S.C. Section 7006 ) (``E-Sign'') with an understanding of the import 
role electronic transactions were to play in both world-wide and 
national commerce. E-Sign gave electronic documents equal footing with 
their paper-based counterparts. It, also, recognized that electronic 
documents could be notarized. Parties using electronic documents 
generally do not anticipate face-to-face meetings with others involved 
in the transaction. Consequently, the need to have properly 
authenticated electronic documents is acute. Notaries public armed with 
new technology to perform electronic notarizations are equipped to meet 
this demand. H.R. 1458 would provide that electronic notarizations 
receive the same interstate recognition it seeks to accord traditional, 
paper-based ones. As a result, an electronic document requiring a 
notarization could not be ignored solely on the basis it was not 
notarized in the jurisdiction where it is presented. Since many 
electronic documents travel over State borders, requiring that an 
electronic notarization be recognized irrespective of the State in 
which it was performed will help promote electronically-based 
interstate commerce. Failure to do so could undercut important 
commercial goals advanced by E-Sign.
    It could be suggested that H.R. 1458 is unnecessary because out-of-
state notarizations should receive recognition under the United States 
Constitution Article IV, Section I, often referred to as the ``Full 
Faith and Credit'' Clause. The underlying rationale for this position 
is that notaries public are authorized by the State to perform 
``public'' acts, which, by the specific language of the Clause, are 
entitled to ``full faith and credit'' and thus should be recognized 
throughout the States. Although they may deserve such recognition under 
the aegis of the Clause, current practice does not suggest that is 
happening. This Bill steps in and ensures the recognition when 
interstate commerce is involved, and obviates the need for parties to 
press constitutional arguments in order to achieve the desired result.
    Additionally, one could suggest the Bill is unwarranted because 
local law should control matters relating to recognition of acts in the 
local courts. Clearly each State could develop its own rule for 
recognizing notarizations from foreign jurisdictions. The weakness of 
this position lies in the lack of uniformity that can result. Whereas 
this may not prove to be a problem for strictly local issues, e.g., 
whether or not to admit a will to probate to govern in-state property, 
it can be quite troublesome for transactions that touch more than one 
State. People and businesses who execute documents that make their way 
into interstate commerce need the assurance of having them accepted 
wherever commerce takes them. Allowing individual States to establish 
their own notarial recognition rules cannot guarantee that result. 
Consequently, the otherwise routine performance of some interstate 
transactions could be impeded. This Bill will ensure that notarizations 
authenticating documents affecting interstate commerce will receive 
proper recognition in every court in which they are presented. This 
will both facilitate interstate commerce and make sure its 
participants' access to the judicial system is not hampered by the 
unexpected peculiarities of local rules.
    As the Committee Members no doubt are aware, statutes need proper 
wording to avoid unwanted results that can be caused by unanticipated 
interpretations of their language. To prevent such problems from 
arising, the current form of H.R. 1458 might benefit from some slight 
language changes. These are noted below.
    1) In the first paragraphs of both Section 1 and Section 2, the 
word ``lawful'' should be added immediately before ``notarization''. 
The present language mandates recognition of ``. . . any notarization 
made by a notary public licensed under the laws of a State other than 
the State where the court is located . . .'' Generally, a notary public 
is authorized to perform notarizations only in the jurisdiction in 
which his or her commission or license is issued. One could read the 
current Bill language to suggest that recognition must be accorded 
notarizations executed by notaries outside of their jurisdictions even 
though those acts are unlawful. For example, a notary public from State 
X, authorized to perform notarizations only in State X, notarizes a 
document in State Y. Even though that notarization is not ``lawful'' 
(it exceeds the notary public's authority), under the Bill it could 
receive recognition as ``any notarization'' made in a State other than 
the State where the court sits. Limiting mandatory recognition only to 
``lawful'' notarizations will clarify the legislative intent and 
preclude any interpretations suggesting the Bill seeks to override the 
limitations imposed by State-granted notarial authority.
    2) The first paragraphs of both Sections 1 and 2 reference notaries 
public ``licensed'' by a State. In many jurisdictions, notaries public 
are ``commissioned'' by the State. Adding the words ``or commissioned'' 
after the word ``licensed'' as it appears in each Section will ensure 
that notarizations of notaries public in all jurisdictions will be 
covered by the Bill.
    Importantly, nothing in this Bill attempts to regulate notaries 
public or in any way detract from the individual States' authority to 
do so. The power to commission and sanction notaries public remains 
within the exclusive province of the States. The Bill seeks only to 
give nation-wide recognition to notarizations executed by those persons 
who have been conferred the authority to perform them under the 
statutes of their commissioning States. In sum, the Bill addresses only 
the recognition of the notarial act, and does not speak to the 
underlying authority that gives rise to the act.
    For the above reasons, I am pleased to add my support to this 
legislative initiative. The Bill recognizes that society has become 
more mobile. The number of people traveling from State to State has 
increased. Additionally, advances in computer systems and technology 
has made it easy for many businesses to operate in more than one State. 
Consequently, more and more documents are working their way into 
interstate commerce. People and businesses relying on notarized 
documents deserve assurances that the documents will be respected and 
the legal rights created by them properly protected. By mandating 
recognition of notarial acts performed in non-forum States, this Bill 
takes a giant step toward that end.

    Mr. Smith. Thank you, Mr. Morris. Mr. Googasian?

             TESTIMONY OF DEAN M. GOOGASIAN, ESQ., 
                      GOOGASIAN FIRM, P.C.

    Mr. Googasian. Thank you, Mr. Chairman, Ranking Member 
Berman, and Members of the Committee.
    I am pleased to appear today to provide testimony in 
support of H.R. 1458, as well as the proposed amendment, which 
would add electronic notarization, because the bill would 
improve the efficiency of our State and Federal courts and 
promote justice.
    Mr. Chairman, as you mentioned during your introduction, my 
law practice is devoted to civil litigation on behalf of 
individuals and corporations. We deal with affidavits in our 
practice every day.
    Notarized affidavits are required in many cases to support 
the claims and defenses that are made in court, and in other 
situations are used as an efficient and inexpensive method of 
providing necessary testimony to a court of law. Affidavits are 
frequently used to support and oppose motions, including 
motions for summary judgment, whose purpose it is to weed out 
cases that--where there's no issue to be decided at trial.
    H.R. 1458 would remedy the very real problem that arises 
when one State refuses to recognize documents notarized in 
another State. In my home State of Michigan, for example, an 
appeals court ruled last year, incorrectly I believe, that 
Michigan should follow a statute enacted in 1879 and refuse to 
recognize affidavits notarized outside of Michigan unless those 
notarizations are certified.
    Certification under the Michigan statute requires that a 
Government official certify that the notary was duly authorized 
and that the notary's signature was genuine.
    But the court also ruled that the affidavit had to be 
certified by a particular Government official, the clerk of the 
court in the county in which the affidavit was notarized.
    Michigan, in effect, has told every other State that that 
State must have a particular person certify the affidavit or 
Michigan will refuse to recognize it.
    In addition to the inefficiency that is required by 
certification in the area of litigation, where time is 
frequently of the essence, this refusal to recognize out-of-
State affidavits raises a great danger of injustice.
    In 7 of the 13 States whose Representatives appear on this 
Subcommittee, including California, Florida, Massachusetts, New 
York, Tennessee, Utah, and Wisconsin, certification by the 
clerk of the local court is simply not available. In those 
States, the laws have been changed since 1879 to provide 
certification by a Secretary of State or perhaps another local 
official, but not specifically by the clerk of the court.
    As a result, Michigan courts may refuse to recognize valid 
certified affidavits from these States and others where the 
local clerk of the court does not provide certification. This 
creates a very real problem for businesses inside and outside 
of litigation and individuals as well.
    One troubling situation in our State confronts creditors. 
Michigan has a streamlined statutory process for litigating 
creditor disputes. Credit card companies, retail creditors, 
home stores, and auto companies are required in our State every 
year to file thousands of lawsuits to collect millions of 
dollars owed to them by debtors.
    Michigan's streamlined process requires an affidavit be 
filed with the complaint stating the amount of the debt owed. 
If such an affidavit is filed within 10 days of its signing, 
the creditor is entitled to summary judgment if the complaint 
is not disputed.
    Certification in those States where it's available 
frequently can take 10 days or more by the time the affidavit 
is sent to the local public official and returned.
    But this problem is not limited, of course, to creditors. 
It applies to any corporation having offices outside a 
particular State or even employees who are located outside a 
particular State, and creates a very real risk that they will 
either not have their affidavit recognized or be forced to go 
to the cost and expense of travel, either to Michigan or to 
another State where the affidavit is recognized.
    In my own practice, it affects where we can look for 
particular experts and on behalf of the corporations we 
represent, it makes it more difficult for them to become 
effectively involved in Michigan's courts.
    I thank you for the opportunity to appear and testify in 
support of this legislation. Thank you.
    [The prepared statement of Mr. Googasian follows:]

                Prepared Statement of Dean M. Googasian




    Mr. Smith. Thank you, Mr. Googasian. Mr. Turner?

           TESTIMONY OF MICHAEL FRANK TURNER, OWNER, 
                 FREEDOM COURT REPORTING, INC.

    Mr. Turner. Thank you for letting me come here. This is 
quite an honor, and it's a long way from rural Alabama and even 
Plainview, Texas to Washington, D.C., and as a matter of fact I 
was asked if I was from Texas this morning in a cab on the way 
over here, Mr. Chairman, so know that I talk like I'm from 
Texas.
    But it's an honor to be here and to be among these people 
here and, you know, I'm in a different realm. I'm a court 
reporter for--and I've submitted my testimony already for you 
guys, and been doing this 30 years; and have been ever since 
the get go of coming out of Plainview, Texas and going to work 
in Alabama as court reporter been on the road taking 
depositions, and that's my function in this judicial system 
here in the United States, and have been administering oaths 
all over the U.S. by agreement. We have to get an agreement 
when we're taking a deposition.
    And it's just been a constant thing over the years, and I 
had one of my staff people pull the records, and it's attached 
to my affidavit of what just our little firm covered in January 
and February out-of-State depositions of this year, and it was 
170. And there are much bigger firms than ours across the 
country that are doing the same thing, and it just would make 
things a lot easier on us and not have that technical question 
of whether or not the deposition is going to be admitted when 
the time comes.
    Again, it's just an honor to be here, and that's--I hope 
that y'all will see fit to pass the bill, and like I said, I 
don't see it takes away from anybody in any capacity. It just 
further extends the territory and scope of those of us who've 
already passed the test I'll call it to become a notary in our 
local States.
    [The prepared statement of Mr. Turner follows:]

               Prepared Statement of Michael Frank Turner



    Mr. Smith. Okay.
    Mr. Turner. Okay.
    Mr. Smith. Thank you, Mr. Turner.
    Let me address my first question to Mr. Reiniger and Mr. 
Morris, and this goes to something that I mentioned in my 
opening statement. We have the 10th Amendment, States' Rights.
    Does this bill present any constitutional questions that we 
need to be concerned with because of the 10th Amendment?
    Mr. Reiniger. Thank you, Mr. Chairman. We do not believe 
that there is a 10th Amendment problem with this bill. We are 
fully aware--our national association deals with the 50 
commissioning officials and the 50 States or generally the 
Secretaries of State, and the States do regulate the notaries. 
They set all the commissioning requirements. They determine, as 
I mentioned earlier, the forms of the seals to use and that 
does vary, whether it's an embosser or a stamp.
    Every State but one does require some form of evidence of 
the official status of the individual as a notary, which we 
refer to as the seal or the seal information.
    This bill deals with the legal effects of documents that 
have been notarized, so we do not--we see it as a totally 
different issue, the legal effect of the document, 
admissibility versus rules of procedures for notaries.
    Mr. Smith. Okay. Thank you. Mr. Morris, do you have any 
constitutional concerns here?
    Mr. Morris. No, unless we--you know without the word 
``lawful,'' if you're just looking for at or recognizing the 
lawful act of a notary in State X to be recognized in State Y, 
I don't see any constitutional issues.
    Mr. Smith. Okay.
    Mr. Morris. If you are going to have the bill go forward as 
is, I could see someone raise the argument that by allowing any 
notarization performed anywhere in the country even though the 
notary is performing it in a jurisdiction in which he is not 
licensed, that that could be an extension of authority to give 
notaries to act beyond their own jurisdictional borders.
    Mr. Smith. Okay. At first glance, your suggestions of 
inserting those words ``lawful'' and ``commissioned'' in those 
particular places I think is a good one. We'll double check it, 
but that may well help the bill.
    A question I had for you, though, Mr. Morris, was we heard 
Mr. Googasian mention a while ago the problems that have been 
created by Michigan requiring the certification out of State, 
and, Mr. Googasian, you mentioned a half a dozen States, 
including California, where that certification is apparently 
impractical or not existent, and so there are problems there. 
But do you know of any other problems that have been created by 
the current system that would be solved by this particular 
piece of legislation?
    Mr. Morris. Not specifically other than the inclusion of 
the electronic section would make clear that electronic 
documents would be given the same accord.
    Mr. Smith. Okay. And you anticipated a later question as 
far as the electronic notarization, so I appreciate your 
comments on that.
    Mr. Googasian, as I said, you mentioned the problems 
created by Michigan saying that they had to be certified if 
they were out of State. There was something in your testimony 
that made me want to ask you about the experience perhaps of 
other countries. I don't know that you mentioned the European 
Union, but do we have anything to learn from the experiences of 
other countries as far as the bill goes?
    Mr. Googasian. With respect to other countries, I guess 
what I would point to Mr. Chairman is the Hague Convention and 
the requirement among the countries who are party to the Hague 
Convention that the documents be recognized with a particular 
certification, an apostille I believe is what is required, a 
particular document from a particular Government official.
    The current stance in Michigan raises a very real question 
about whether even a document that would be acceptable in a 
foreign country, coming, for example, from California, would be 
admitted into a court in Michigan, so you have the sort of 
irony that one of the sister States wouldn't recognize 
something that would be admissible in any of the many----
    Mr. Smith. Okay.
    Mr. Googasian [continuing]. Hague Convention countries.
    Mr. Smith. Thank you. As I say, you've mentioned some 
specific problems with the current system that would be 
addressed by this legislation, and that's why that's 
particularly helpful.
    Mr. Turner, I wanted to ask you a question, and that is 
that assuming that we address the constitutional problems and 
assuming that the problems that we are hearing about are real 
and I think that they are, I'm looking for who might be opposed 
to this legislation. Do you think that there would be out-of-
State notaries who would be opposed to the bill because frankly 
it would--they would be in competition with others from out of 
State and lose some business or is that a--do you know of 
anyone who would be adversely impacted by this legislation, 
particularly out-of-State notaries?
    Mr. Turner. I don't. I mean I thought of that, you know, 
when we were talking about this, and for sake----
    Mr. Smith. I mean presumably there are a lot of out-of-
State notaries who are losing business because of the need to 
either get a document notarized again within that State's 
boundaries, and they would--but you haven't heard of any 
problems in that regard?
    Mr. Turner. No, and our experience has been, Mr. Chairman 
that when we show--when we go--in our particular instance, 
where we're taking depositions, for us to try to hire a local 
notary to come notarize a deposition is it's generally not 
worth their time for what they charge to come do that. And I--
--
    Mr. Smith. Okay.
    Mr. Turner [continuing]. So I don't see that as a problem.
    Mr. Smith. Okay. May I--just a real quick personal 
question, although my time is up. What does it take to become a 
notary in Texas today? Do you know?
    Mr. Turner. I do not know in Texas.
    Mr. Smith. Okay. Thank you, Mr. Turner. It used to be so 
easy I worried about, to tell you the truth.
    Thank you. The gentleman from California, Mr. Berman, is 
recognized for his questions.
    Mr. Berman. Probably an obligation to support the 
Republican Party.
    Obligation to support the Republican Party, if you want to 
given note. It is a patronage position in Texas.
    Given that notaries may have to follow different rules in 
different States when performing a notarial act, maybe this is 
for Professor Morris, if one State requires notaries to inquire 
into whether the principal shows a demeanor such that he or she 
cannot appreciate the consequences of the act or if there is 
evidence to suggest compulsion, should the State that requires 
inquiry into these matters have to accept documents 
acknowledged or witnessed by a notary in the State that does 
not? In other words, one State is silent on it. The neighboring 
State says you can't notarize a signature unless you've 
established this person knows the consequences of what he's 
signing or isn't doing it under compulsion, does the State that 
makes that requirement have to accept notaries from States that 
don't?
    Mr. Morris. Well, I--Congressman, I don't think they have 
to accept notaries. I think they're accepting the document for 
what it purports to be. That would not preclude any party to 
that document to go into court and challenge the efficacy of 
the document itself. Wills are a perfect example.
    Mr. Berman. I have evidence that this guy--there was a 
third person in the room who had a gun to the guy's head and--
--
    Mr. Morris. That's what will contests are all about. Due 
formality has been met.
    Mr. Berman. Okay.
    Mr. Morris. But all this is saying is you can't throw it 
out just because in State X we don't require that inquiry. It's 
still available. The parties who are challenging the document 
would not precluded from that action.
    Mr. Berman. A notary--the fact of the seal doesn't prevent 
the----
    Mr. Morris. I would not----
    Mr. Berman [continuing]. Challenge to the----
    Mr. Morris. I think notarized documents are challenged all 
the time.
    Mr. Berman. You've stated in your testimony that the 
purpose of this bill--well, does anybody disagree with that?
    Mr. Reiniger. Representative Berman, I would just add that 
we are concerned about this very question that you have about 
the lawfulness of the notarization and its varying requirements 
around the country, particularly in the area of electronic 
documents, which is just now emerging, the whole area of 
electronic notarization.
    California, for example, requires an electronic image of 
the seal to be placed on the document. The Commonwealth of 
Pennsylvania just recently issued rules, the Secretary of the 
Commonwealth, that sets up a requirement that every notary use 
a digital certificate, because that State is viewing 
notarization as a security procedure for the document.
    Colorado has yet a different system of security, which 
involves the issuance of authentication numbers from the 
Secretary of State to individual notaries. I was telling Mr. 
Googasian that Michigan and Texas have authorized electronic 
notarization, but with no clear standards at all. It could be 
any type of click button or seal. So it will raise the concern 
that how will one State recognize the documents coming in from 
another, like, for instance, the Commonwealth of Pennsylvania 
is saying there needs to be a high level of security to the 
document that's notarized. Do they need to accept documents 
coming in from Michigan or elsewhere that have no security 
procedures connected to the notarization?
    Mr. Berman. Well, that problem exists right now.
    Mr. Reiniger. Right.
    Mr. Berman. Now, this bill passes, and it says that if 
it's--if it's--if the notarization occurs or it affects 
interstate commerce in the case of an electronic record, 
Federal courts must recognize a notarization if the seal 
information is securely attached to or logically associated 
with the electronic record so as to render the record tamper 
resistant.
    Does the California law meet that requirement?
    Mr. ReinigerMorris. Not completely in its current form. It 
is an attempt at a level of security.
    Mr. Berman. So, then, if this bill were to become law, this 
bill doesn't require Federal courts to accept--it doesn't 
require them to recognize that notarization from the other 
State? Where the Federal court is located, it doesn't require 
them to accept out-of-State notarizations, and we're in a 
situation where the law is right now?
    Mr. Reiniger. Well, it would address the issue of self-
authentication, so in other words, the notarial acts could be 
enforced, but it would be a matter of acquiring extrinsic 
evidence, perhaps a certification of the notarial act of 
California, unless it meets the minimum security requirement. 
So that's--it goes to the issue of self-authentication without 
requiring additional evidence.
    Mr. Morris. Mr.--Congressman, if I may, but if you think 
your argument through and this bill passed----
    Mr. Berman. One thing I can assure is I haven't.
    Mr. Morris. I'm sure you have.
    Mr. Berman. No. I'm not sure I haven't.
    Mr. Morris. Oh. Is that would encourage States to meet the 
test to put into place procedures that would be satisfactory, 
consistent with this statute, and then there wouldn't be any 
problems. And really E-sign was an example of that, where 
Congress stepped forward and told the States, look, you have to 
start thinking about interstate electronic transactions and 
here's the rule. And you can opt out of the Federal rule by 
adopting UETA or a similar statute because that provides what 
we want. And I think that----
    Mr. Berman. Yeah. It's like----
    Mr. Morris [continuing]. Worked very nicely.
    Mr. Berman [continuing]. Like a Federal law that says you 
want any Federal money for your law school, you accept 
recruiters from the military on your campus. It encourages 
people--local law schools and State law schools to accept 
military recruiters, which is all right with me, but it's----
    Mr. Morris. I think there--I think we could draw a 
difference between promoting commerce and, you know, political 
issues that are raised with the military----
    Mr. Berman. No. No.
    Mr. Morris [continuing]. But you're right. It's the same 
concept. This promotes--promoting a goal. Absolutely.
    Mr. Berman. The only question here is do we want to create 
that dynamics with the passage of a Federal law that gets 
States to change what they would otherwise do. And----
    Mr. Morris. I would say to get them to change to do 
something they're not doing, which the rest of the world is. 
And I think they may have maybe----
    Mr. Berman. Well, I'm fine with using Federal power to do 
that. The Republicans used to be concerned about that, but they 
aren't anymore. So.
    Mr. Morris. Well, I want to leave this room safely, so I'll 
make no comment.
    Mr. Berman. Thank you.
    Mr. Smith. Thank you, Mr. Berman. Mr. Berman's last 
question reminded me of a question I didn't ask that I'd like 
to now. And it had to do with the reform, and, Mr. Reiniger, 
you may be the best one to answer this. What--there was a 
reform effort made to change the notary statutes in a number of 
States, but only about a dozen States have adopted those 
particular reforms that would answer some of the questions that 
have been raised today and respond to some of the problems that 
have mentioned. Why is that more States have not adopted the 
model notary statutes?
    Mr. Reiniger. Via the States have--they all, like I have 
mentioned, 50 different approaches to the notary laws. A lot of 
them are served by history, cultural influences.
    The--and we have seen trends from the New England States 
that from the colonial traditions, which tend to have more 
barebones laws, and as you head to the West, greater 
regulation. So the State of California has probably the most 
outstanding set of laws and regulations to protect the public; 
the strongest educational requirements on notaries, for 
example. So there's a wide variety, and in every State 
certainly we advocate for the Model Notary Act, which we put 
together with a committee of law professors in 2002, not the 
latest version, a lot of States culturally don't necessarily 
see the need for education, so there is--we run into that issue 
quite a bit.
    Mr. Smith. Okay. Well, in that case, why impose a national 
standard on them that might be uncomfortable to them culturally 
to use your word?
    Mr. Reiniger. Well, in this case, we like this bill, 
because it's talking about a standard for the legal effects of 
the material act, the admissibility of it, not at all 
interfering with the State requirements for education, 
regulation of the notaries themselves.
    We believe that this minimum standard, which would be very 
beneficial to consumers and business commerce, would also have 
the effect of helping our efforts to professionalize notaries, 
to raise their standards.
    Mr. Smith. Are you aware of any States--notary 
organizations who would oppose legislation like this?
    Mr. Reiniger. We are absolutely not.
    Mr. Smith. Okay.
    Mr. Reiniger. We're not aware of any opposition to this 
proposal.
    Mr. Smith. Okay. All right. That answers my question. I 
thank you all, and, Mr. Turner, thank you for you coming the 
greatest distance, and we appreciate your testimony as well as 
the testimony of everyone here.
    I'm not sure what the next step will be, but it sounds to 
me like there is near consensus of support for this 
legislation, so it may well be that we will look for an 
opportunity to move it along and hopefully that will prevent 
some of the problems that we heard about today, specifically 
those problems mentioned by Mr. Googasian and also, as you 
said, Mr. Reiniger, help promote trade and commerce as a result 
of passing this legislation as well.
    So we appreciate Mr. Aderholt's coming to me months ago and 
telling me about the problems that he had seen firsthand and 
probably heard about firsthand from you, Mr. Turner. So thank 
you again for being here and for your testimony, and we stand 
adjourned.
    [Whereupon, at 10:53 a.m., the Subcommittee was adjourned.]

                            A P P E N D I X

                              ----------                              


               Material Submitted for the Hearing Record

Prepared Statement of the Honorable Howard L. Berman, a Representative 
     in Congress from the State of California, and Ranking Member, 
    Subcommittee on Courts, the Internet, and Intellectual Property

    Mr. Chairman,
    Thank you for scheduling this hearing on H.R. 1458, which requires 
recognition of out of state notarizations by Federal and State courts. 
Although the topic of notary recognition between the states is not the 
most exciting issue--it is an extremely practical one.
    Notaries are involved in many aspects of legal and commercial 
transactions from trusts and estates to real estate. Currently, each 
individual state creates its own laws to regulate the notary 
profession. H.R. 1458 has been introduced in an attempt to unify and 
standardize the acceptance of out-of-state notarial acts by state and 
federal courts. There have been past attempts at unifying the 
requirements for notarial acts: some made by the National Notary 
Association through the Uniform Notary Act of 1973 and its successors, 
the Model Notary Acts of 1984 and 2002; and others made by the National 
Conference of Commissioners on Uniform State Laws when it enacted the 
Uniform Acknowledgement Act of 1939, the Uniform Recognition of 
Acknowledgements Act of 1968, and then finally the Uniform Law on 
Notarial Acts in 1982. Over the course of three decades, legislators 
and notary-regulating officials have borrowed from these models in 
reforming state and territorial notary laws on inconsistent bases. In 
some cases, only a few sections were adopted into statute; in others, 
the model was enacted virtually in totality.
    H.R. 1458 would require each Federal or State court to recognize 
out of state notarial acts under the following 2 conditions: (1) where 
such notarization occurs in or affects interstate commerce; and (2) if 
a seal of the notary public's authority is used in the notarization; or 
in the case of an electronic record, the seal information is logically 
associated with the electronic record so as to render the record 
tamper-resistant.
    I hope the witnesses can delve into the constitutional issues 
presented by this bill. For example, does the bill's language violate 
the Tenth Amendment, which disallows the federal government's 
encroachment upon the States' ``reserved powers'' or would the concept 
of Full Faith and Credit apply?
    Additionally, given that notaries may have to follow different 
rules in different states when performing a notarial act, if one state 
requires notaries to inquire into whether the principal shows a 
demeanor such that he or she cannot appreciate the consequences of the 
act or if there is evidence to suggest compulsion, should the state 
that requires inquiry into these matters have to accept a document 
acknowledged or witnessed by a notary in a state that does not?
    Again, I look forward to learning what specific situations the bill 
is trying to address, how prevalent the problem is of out-of-state 
notarial recognition, and how the witnesses will address the states' 
rights issues touched on by this bill, such as the relevance and 
applicability of the 10th Amendment and the Full Faith and Credit 
Clause.
    I yield back the balance of my time.

                                 
