Be practical.
1) Ask the notary to submit in writing what the original fee was, what the problems were, and what she wants for the change. You now have a paper trail for your attorney and state regulator.
2) If it is not a large amount of money you might pay it. I would get the documents back. Then I would contact lawyer. If she agrees to return the difference. You might call it day. Otherwise, you will take legal action.
You might also agree not to report her to the state licensing authority requesting her commission be revoked. A copy of your original confirmation with fee and her "extortion" email should be attached. In my state telephone conversations can be recorded as long as one party to the call is aware they are being recorded. Not sure what rules apply in your state...ask your lawyer.
3) If it is not too embarrassing, you might contact the client and have a second notary redo the signing. Explain the problem. If I were a client, I would resign and be mad as hell at the first notary. I would still ask the original notary for an email as described above. I would not tell her I was doing a second signing. Tell her your boss insists that her request be made in writing so that she does not change her mind again and raise the rate a third time. Tell her on occassion your company has approved a higher fee, but only after submitted in writing. (a fax with her signature on it would be even better than an email) Again, after you get the documents back or have the second notary sign... have your lawyer send a letter and report her to the state. If your company has a history of paying a standard rate in a certain area...that can also be evidence to the state authority that this notaries request is inconsistent with your prior payment history. Ask that her seal be revoked. Even if you agree to the higher fee to get the documents back.. call the state authority tomorrow, report the incident and don't pay her. If she want to sue, you will be more than happy to tell a judge that 1) you reported it to the state(( get the name of the person you reported it to for your files)), 2) agree to her revised terms under duress and if she want to sue you will countersue 3) if you had her sign a contract that you will hold her liabile for all costs in defending yourself 4) she could be subject to violation of theft of property and state privacy law and 5) you will be on record with another set of documents from another notary in that state which supports your claim 6) the borrower will act as a witness on your behalf and 7) the borrower might sue her separately for violation of state privacy laws.
4) Remove her from your list.
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