Verifying the competency of a signer is at the heart of a notary public and loan signing agent’s job. This duty is a frequent concern in the notary business that may arise during any document signing. It is essential that a notary public or loan signing agent correctly identifies a signer and verifies that they are competent or understand what they are signing. Many notary publics and loan signing agents will come across signers from whom they feel uncomfortable obtaining a legal signature on an official document. There are several reasons why a notary public or loan signing agent may deem a signer incompetent. In the following article, we explore some of these reasons. A signer may be medically incompetent, under the influence of drugs or alcohol, or the notary public may suspect the signer is being manipulated or coerced.
What is competency?
The definition of competency is the ability to do something successfully or efficiently. Regarding notary public work, competency refers to a signer’s legal capacity to sign an official document, make rational decisions and express themselves. The scope of competency is a challenging yet core responsibility of any notary public or loan signing agent.
Although the concern of competency may arise during any signing, competency most frequently comes into question during the signings of Wills, Power-of-Attorney documents, and other vital documents.
As mentioned previously, if a signer is suffering from a medical condition such as Alzheimer’s or Dementia or is taking medication that impairs their judgment, they may be deemed incompetent. Additionally, any person under the influence of alcohol or a controlled or uncontrolled substance is considered incompetent and incapable of signing a legal document. If a notary public or loan signing agent is aware of these conditions, they must stop and not proceed with the signing.
All title insurance policies provide coverage against duress, incompetency, or incapacity claims. If a signer shows signs of incompetency, the title company depends on the notary public and loan signing agent to stop the transaction when any of these situations are detected.
Observation, NOT diagnosis!
Signer competence is a legal issue and not one for the notary public or loan signing agent to determine. Competence regards the signer’s comprehension of a document, its contents, and the potential ramifications of signing. Notary publics and loan signing agents use their experience and expertise to make educated decisions regarding competency based on their observation and interaction with a signer.
Notary publics and loan signing agents are under no circumstances offering a medical diagnosis of a signer. Title companies do not expect a notary public or loan signing agent to give a medical opinion regarding a person’s competency.
In many cases, mental competence is very complex and challenging for appropriate professionals to diagnose. However, if a notary public or loan signing agent suspects that a signer is not fully competent, they should ask a few simple follow-up questions. Ask the signer if they know what they are signing and what the document means. Depending on the answers, the notary public or loan signing agent may ask additional questions that a competent person should be able to answer. These questions may include the date, day, year, time to the nearest hour, and the current President’s name. Whenever there are follow-up questions, the notary public or loan signing agent should document the questions and answers in their notary journal. This documentation can prove to be crucial evidence if the competency of the signer is ever challenged by a family member or in a legal proceeding.
If a signer appears to be under the influence of alcohol, you or the signer should reschedule for another time. If the signer appears incompetent for another reason, you should not continue the process. In the event that a notary public deems the signer incompetent for any reason, it is essential for them to express why they are cancelling the signing and remove themselves from the situation as quickly as possible. Depending on the exact concern, the signer may have to provide a letter from their medical doctor about their ability to make financial decisions. An appropriate court will appoint a conservator or guardian if their doctor does not deem them capable.
Your Liability
Commissioned notary publics and loan signing agents should be just as concerned about signers’ competency as they are about identification. A notary public or loan signing agent can be held personally liable for notarizing the signature of an incompetent person and face claims against their notary bond or errors and omissions insurance. As previously stated, any notary public or loan signing agent who refuses to notarize a document for someone who appears incompetent should document the refusal in their notary journal.
Remember, family members of a signer and courts may challenge documents signed by an incompetent person. For example, if the document was a deed transferring title, and a medical evaluation proves a signer was not legally capable, a court ruling can overturn the transfer. The title insurer would have to defend the insured, resulting in a costly claim. Notary publics and loan signing agents are the best defense to prevent these claims.
How important and challenging is judging competency?
There has been an ongoing debate for years about whether notaries public have the responsibility to judge the awareness or competency of a signer as a requirement for obtaining a legal signature or performing a notarization.
This particular responsibility of the notary public and loan signing agent is challenging for two reasons. The first reason is a lack of clear state law indicating whether the notary public or loan signing agent is to judge the signer’s ability to have their signature notarized or oath administered. The second reason is that the terms “understanding,” “capacity,” “competence,” “comprehension,” and “awareness” are used interchangeably and have broad definitions.
States like California do not offer clear guidelines for notary publics and loan signing agents to evaluate a signer’s competence. However, in terms of notarial certificates, if a signer cannot acknowledge their signature, the acknowledgment cannot be completed by the notary public or loan signing agent. For a jurat, the notary public or loan signing agent cannot complete the oath if a signer cannot respond verbally. On the contrary, states like Rhode Island, Georgia, Iowa, North Dakota, Montana, Oregon, and West Virginia grant notary publics and loan signing agents the authority to refuse to complete a notarization if they believe that the signer is incompetent or lacks the capacity to sign. Notary2Pro encourages all notary publics and loan signing agents to check their state rules and regulations regarding competency.
I was called and asked if I could notarize a document. I went to the signer’s home. The signer was a lovely woman. While unpacking my notary supplies, I asked her various questions (my competency questions) How are you doing? What do you think of the weather, etc. just talking. I noticed several things during our conversation that gave me pause. For example, I noticed she repeated herself quite a bit, almost as if she had forgotten what she had previously said. Her mobility was very slow, and at times it seemed as if it was involuntary. Although mobility, or lack thereof, has little to do with competence, involuntary movements could cause a big problem when signing documents. As time passed, it was clear to me that the signer was unable to sign the documents physically, nor was she in the condition to sign the documents on a competent level. She asked for my name and questioned my purpose for arriving at her home on three occasions. After speaking with the caregiver, she informed me that the signer had recently had brain surgery, and her soon-to-be ex-husband had requested my services. I could not, with good conscience, have her sign the documents as, moment by moment, she did not know who I was or what she was signing. I politely said my goodbyes to her and the caregiver and quickly departed from the home. I called the person who requested my services and informed him that, by law, I could not perform the notarization.
On several occasions, I’ve dealt with competency situations during general notary work (GNW) and loan signing appointments.
A few times during loan signings, signers would open a beer and bring it to the signing table. I do not allow any liquids at the signing table. Let anyone alcohol! In these instances, I always explain that I am handling legal documents, that they need to be fully present and aware of what they are signing, and that I would not proceed if they insist on drinking during the closing. Although some signers have gotten snippy with me or even offered me alcohol, most signers comply.
I had a situation for GNW where I got a call from a woman who needed a financial POA notarized because her husband was dying. I asked her if her husband was familiar with the documents he was signing, if he was coherent, and if he was taking any medications that would affect his memory or awareness. She said he was aware and not taking any narcotics or prescription pain medications. When I arrived, I explained that I would need a few minutes alone with her husband to ask him some questions before proceeding. She seemed agitated and desperate to have him sign right away, which is usually a huge red flag! I went to his bedroom to find him curled in a fetal position. I noticed there were some narcotics on the nightstand. That is another red flag. I told him who I was and why I was there. He could barely speak and seemed agitated. He whispered that he was scared and felt his wife was trying to make him die sooner. I asked him if he knew his wife wanted him to sign a financial POA, and he said, “she’s making me do this against my will!” He was crying. I spoke softly to him and told him I would not proceed with the notarization. I went downstairs and told his wife I could not perform the notarization and gave her the reasons why. She said, “I need this done before he passes away. I need his money.”
My heart just sank. I felt helpless. I got in my car and called adult protective services to report her.
Want To Learn More?
This article covered what competence means to notary publics and loan signing agents, how integral verifying competence is to the notary process, and the notary public and loan signing agent’s liability when assessing the competence of a signer.
Notary2Pro urges notary publics and loan signing agents to fully understand the importance of verifying the competence of a signer, the ramifications of obtaining a signature from an incompetent person, and to have the most up-to-date information regarding your state’s competency laws. Please enroll in our Elite course now if you would like to know more about competence and much more. Notary2Pro is the industry’s most respected, recognized, and comprehensive loan signing agent training available.