Posted by Linda_H/FL on 10/13/10 11:08am
Msg #356568

General question...am just curious

*IF* recording requirements in a state are that the document MUST be notarized...(a mortgage)...

And *IF* the notary who notarized does so with an expired commission but no one picks this up and the document records...

How does that affect the validity of the recording, and thereby the lien position - is it not an invalid recording? I realize the intent of the mortgage is clear...but what is the status of the recording?

Just curious for my own knowledge and I realize this will vary by state - but I did find a mortgage this morning with just those circumstances....so now I'm curious

TIA

Reply by FlaNotary2 on 10/13/10 11:36am
Msg #356575

Here's an example:

Let's say that Georgia requires all mortgages to be acknowledged before an authorized officer. The borrower acknowledges his signature in Florida. Although the mortgage is subject to Georgia law, the acknowledgment is subject to Florida law. Florida sets forth which officials are authorized to take acknowledgments.

So the borrower takes the mortgage to a person in Florida who holds himself out to be a notary public, even though his commission has expired. Therefore, the person who allegedly took the acknowledgment was NOT a notary public, nor was he some other officer authorized to take acknowledgments. Therefore, the mortgage was NOT validly acknowledged under Florida law, and was therefore not entitled to be recorded under Georgia law.

If the document was not ENTITLED to be recorded, it is my understanding that even if it was physically recorded it does not provide "constructive notice" because it was an invalid recording. This obviously poses a big problem to the bank.

Reply by C. Rivera Chicago Notary Services on 10/13/10 11:40am
Msg #356577

that is a good question...I think that if the document

required a valid notarization in order for it be recorded, then the document's filing is invalid, not the document itself, due to the improper or invalid notarization.

But I'm not an attorney, yada yada yada, and ur right, it depends on the state, county, rules & regulations, etc.

Reply by PAW on 10/13/10 11:48am
Msg #356579

Florida statutes often contain wording such that if an acknowledgment certificate is defective, but the underlying document expresses proper intent and execution, then the transaction is considered valid.

As for real and personal property transactions, F.S. 694.08 (Certain conveyances made valid) states:

[quote]
Certain instruments validated, notwithstanding lack of seals or witnesses, or defect in acknowledgment, etc.
—
(1) Whenever any power of attorney has been executed and delivered, or any conveyance has been executed and delivered to any grantee by the person owning the land therein described, or conveying the same in an official or representative capacity, and has, for a period of 7 years or more been spread upon the records of the county wherein the land therein described has been or was at the time situated, and one or more subsequent conveyances of said land or parts thereof have been made, executed, delivered and recorded by parties claiming under such instrument or instruments, and such power of attorney or conveyance, or the public record thereof, shows upon its face a clear purpose and intent of the person executing the same to authorize the conveyance of said land or to convey the said land, the same shall be taken and held by all the courts of this state, in the absence of any showing of fraud, adverse possession, or pending litigation, to have authorized the conveyance of, or to have conveyed, the fee simple title, or any interest therein, of the person signing such instruments, or the person in behalf of whom the same was conveyed by a person in an official or representative capacity, to the land therein described as effectively as if there had been no defect in the acknowledgment or the certificate of acknowledgment, if acknowledged, or the relinquishment of dower, and as if there had been no lack of the word "as" preceding the title of the person conveying in an official or representative capacity, of any seal or seals, or of any witness or witnesses, and shall likewise be taken and held by all the courts of this state to have been duly recorded so as to be admissible in evidence;
[/quote]

The important language is, "... effectively as if there had been no defect in the acknowledgment or the certificate of acknowledgment, if acknowledged, ..."

Reply by Bob_Chicago on 10/13/10 12:19pm
Msg #356582

Maybe valid , maybe not.

Not well settled. Here is a cite to a recent article discussing issue.
Best advice is to speak to a cmpetent LOCAL real estate attorney.
Have not read carefully, but in some cases, it appears that if the intent of the parties was to create a valid lien , then a defect in the notarization, does not necessarily invalidate the document.
Not legal advice yada, yada

http://title.firstam.com/assets/title/uploads/asset-upload-file561-10147.pdf

Reply by C. Rivera Chicago Notary Services on 10/13/10 12:39pm
Msg #356585

same as I had said earlier. The filing maybe perhaps invalid

but not the doc itself. But I dunno....

Reply by PAW on 10/13/10 12:39pm
Msg #356586

Re: Maybe valid , maybe not.

The last paragraph in the "Conclusion" is vital:

[quote]
Finally, the enactment of savings statutes, which provide (whether under a substantial compliance test or otherwise) that defectively executed or performed acknowledgments will not cause a recorded document to be deemed defective and will nonetheless constitute notice to third parties, should be encouraged. Such legislation, which local and state bar associations should be encouraged to promote, provides certainty and reliability of land records and elevates substance over form, making life easier for title insurers. It also cures the unintended effect of lack of notice that defective acknowledgments receive in bankruptcy which presently permits trustees and debtors-in-possession to avoid entire liens and encumbrances based on legal technicalities that differ among the states.
[/quote]

Reply by ReneeK_MI on 10/13/10 2:58pm
Msg #356608

The thing I find most interesting is relative to foreclosure

It's the same deal - invalid notarizations. If it's an invalid recording, it throws lien position up onto the ceiling like a piece of over-cooked pasta.

It's sort of interesting (but growing old, fast) watching how some title insurers are refusing to cover REO's of certain banks; other insurers are flat-out unconcerned.