Bill Text: MI HB5759 | 2021-2022 | 101st Legislature | Introduced
Bill Title: Occupations: notaries public; use of communication technology to perform electronic notarizations and remote electronic notarizations; modify and expand.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2022-02-17 - Bill Electronically Reproduced 02/16/2022 [HB5759 Detail]
Download: Michigan-2021-HB5759-Introduced.html
HOUSE BILL NO. 5759
A bill to amend 2003 PA 238, entitled
"Michigan law on notarial acts,"
by amending sections 3, 5, 26, 26a, 26b, and 27 (MCL 55.263, 55.265, 55.286, 55.286a, 55.286b, and 55.287), sections 3, 26, and 26b as amended by 2020 PA 249 and sections 5 and 27 as amended and section 26a as added by 2018 PA 360, and by adding section 26e; and to repeal acts and parts of acts.
the people of the state of michigan enact:
(a) "Acknowledgment" means a declaration by an individual in the presence of a notary public that he or she has signed a record for the purposes stated in the record and, if the record is signed in a representative capacity, that he or she signed the record with the proper authority and signed it as the act of the person identified in the record.
(b) "Cancellation" means the nullification of a notary public commission due to an error or defect or because the notary public is no longer entitled to the commission.
(c) "Communication technology" means an electronic device or process that does 1 or both of the following:
(i) Allows a notary public and a remotely located individual, including an individual for whom the notarial act is being performed or a witness to the notarial act or to a legal transaction covered under section 26e, to communicate with each other simultaneously by sight and sound, and allows the notary public to record and store an audio or visual recording of the notarial act as required under section 26b.
(ii) If necessary, and consistent with other applicable law, facilitates communication between a notary public and a remotely located individual who has a vision, hearing, or speech impairment.
(d) (c) "Credential analysis" means a process or service by which a third party affirms the validity of an identity document described in under section 25(6)(c) through a review of public and proprietary data sources conducted remotely.
(e) (d) "Department" means the department of state.
(f) (e) "Electronic" means relating to technology that has electrical, digital, magnetic, wireless, optical, electromagnetic, or similar capabilities.
(g) (f) "Electronic notarization system" means a set or system of applications, programs, hardware, software, or technologies designed to enable a notary public to perform electronic notarizations.
(h) (g) "Electronic signature" means an electronic sound, symbol, or process attached to or logically associated with a record and executed or adopted by an individual with the intent to sign the record.
(i) "Financial institution" means any of the following entities:
(i) A federal or state chartered bank, credit union, savings bank, or savings and loan institution.
(ii) An entity of the federally chartered farm credit system.
(iii) A subsidiary of an entity described in subparagraph (i) or (ii) that is wholly owned by that entity.
(iv) A credit union service organization owned in whole or in part by 1 or more federal or state chartered credit unions.
(j) "Financial services provider" means a financial institution, licensed mortgage lender, licensed real estate broker, or title insurance company.
(k) (h) "Identity proofing" means a process or service by which a third party provides a notary public with a reasonable means to verify the identity of an individual through a review of personal information from public or proprietary data sources conducted remotely.
(l) (i) "Information" includes data, text, images, sounds, codes, computer programs, software, and databases.
(m) (j) "In a representative capacity" means any of the following:
(i) For and on behalf of a corporation, limited liability company, partnership, trust, association, or other legal entity as an authorized officer, manager, agent, partner, trustee, or other representative of the entity.
(ii) As a public officer, personal representative, guardian, or other representative in the capacity recited in the record.
(iii) As an attorney in fact for a principal.
(iv) In any other capacity as an authorized representative of another person.
(n) (k) "In the presence of" means either 1 or both of the following:
(i) In the same physical location with and close enough to see, hear, communicate with, and exchange tangible identification credentials with another individual.
(ii) Interacting with another individual by means of audio and visual communication technology that is part of a remote electronic notarization platform approved under section 26b or 2-way real-time audiovisual communication technology that meets the requirements under section 26c.26e.
(a) "Jurat" means a certification by a notary public that a signer, whose identity is personally known to the notary public or proven on the basis of satisfactory evidence, has made in the presence of the notary public a voluntary signature and taken an oath or affirmation vouching for the truthfulness of the signed record.
(b) "Lineal ancestor" means an individual who is in the direct line of ascent including, but not limited to, a parent or grandparent.
(c) "Lineal descendant" means an individual who is in the direct line of descent including, but not limited to, a child or grandchild.
(d) "Notarial act" means any of the following:
(i) An act, whether performed with respect to a tangible or electronic record, that a notary public commissioned in this state is authorized to perform including, but not limited to, taking an acknowledgment, administering an oath or affirmation, taking a verification upon oath or affirmation, or witnessing or attesting a signature performed in compliance with this act.
(ii) An act described in subparagraph (i) that is performed in another jurisdiction and meets the requirements of section 25a.
(e) "Notify" means to communicate or send a message by a recognized mail, delivery service, or electronic means.
(f) "Official misconduct" means 1 or more of the following:
(i) The exercise of power or the performance of a duty that is unauthorized, unlawful, abusive, negligent, reckless, or injurious.
(ii) The charging of a fee that exceeds the maximum amount authorized by law.
(g) "Person" means an individual or a corporation, business trust, statutory trust, estate, partnership, trust, limited liability company, association, joint venture, public corporation, government or governmental subdivision, agency, or instrumentality, or any other legal or commercial entity.
(h) "Record" means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.
(i) "Remote electronic notarization platform" means communication technology or any combination of communication technology and other technology that enables a notary public to perform a notarial act remotely ; that allows the notary public to communicate by sight and sound with the individual for whom he or she is performing the notarial act, and witnesses, if applicable, by means of audio and visual communication; and that includes features to conduct credential analysis and identity proofing.
(j) "Revocation" means the termination of a notary public's commission to perform notarial acts.
Sec. 26. (1) Except as otherwise provided in section 26c, a Subject to section 26a, a notary public may select 1 or more tamper-evident electronic notarization systems to perform notarial acts electronically. A person may not require a notary public to perform a notarial act electronically with an electronic notarization system that the notary public has not selected.
(2) Subject to section 26b, a notary public may select 1 or more remote electronic notarization platforms to perform notarial acts for or involving remotely located individuals. A person may not require a notary public to perform a notarial act remotely with a remote electronic notarization platform that the notary public has not selected.
(3) A notary public may perform a notarial act using communication technology as provided under section 26e.
(4) (2) Before Except for a notarial act described under subsection (3), before a notary public performs the notary public's initial notarial act electronically or remotely, the notary public shall must notify the secretary that the notary public will be performing perform notarial acts electronically or remotely and identify the an electronic notarization system or remote electronic notarization platform approved by the secretary and the department of technology, management, and budget under section 26a or 26b respectively that the notary public intends to use for electronic or remote notarizations. If the secretary and the department of technology, management, and budget have approved the use of 1 or more electronic notarization systems under section 26a, the notary public must select the system he or she intends to use from the approved electronic notarization systems. The
(5) The secretary may disallow the use of 1 or both of the following:
(a) an An electronic notarization system if the electronic notarization system that does not satisfy the criteria standards described in section 26a.
(b) A remote electronic notarization platform that does not satisfy the standards described in section 26b.
Sec. 26a. (1) By March 30, 2019, the secretary and the department of technology, management, and budget shall review and approve at least 1 electronic notarization system for the performance of electronic notarizations in this state. The secretary and the department of technology, management, and budget may approve multiple electronic notarization systems , and may grant approval of approve additional electronic notarization systems on an ongoing basis. The secretary and the department of technology, management, and budget shall review the criteria for approval of electronic notarization systems, and whether currently approved electronic notarization systems remain sufficient for the electronic performance of notarial acts, at least every 4 years.
(2) A provider or user of an electronic notarization system or a notary public may submit a request to the secretary and the department of technology, management, and budget to approve an electronic notarization system.
(3) Except as otherwise provided under section 26e, a notary public shall not use an electronic notarization system that is not approved by the secretary and the department of technology, management, and budget under this section.
(4) (2) Subject to subsection (3), (5), in considering whether to approve an electronic notarization system for use in this state under subsection (1), the secretary and the department of technology, management, and budget shall create standards for electronic notarization systems. In creating the standards, the secretary and the department of technology, management, and budget shall consider, at a minimum, all of the following factors:
(a) The need to ensure that any change to or tampering with an electronic record containing the information required under this act is evident.
(b) The need to ensure integrity in the creation, transmittal, storage, or authentication of electronic notarizations, records, or signatures.
(c) The need to prevent fraud or mistake in the performance of electronic notarizations.
(d) The ability to adequately investigate and authenticate a notarial act performed electronically with that electronic notarization system.
(e) The most recent standards regarding electronic notarizations or records promulgated by national bodies, including, but not limited to, the National Association of Secretaries of State.
(f) The standards, practices, and customs of other jurisdictions that allow electronic notarial acts.
(5) (3) If Except as otherwise provided in subsection (6), the secretary and department of technology, management, and budget shall approve the use of an electronic notarization system for the performance of electronic notarizations if the system is approved or certified by a either of the following and verifiable proof of the approval or certification is provided to the secretary and department of technology, management, and budget:
(a) A government-sponsored enterprise, as that term is defined in 2 USC 622(8), the secretary and the department of technology, management, and budget shall approve the system for use in this state if verifiable proof of that approval or certification is provided to the secretary and department, unless 622.
(b) Another state in the United States.
(6) The secretary and department of technology, management, and budget may deny the use of the an electronic notarization system is described in subsection (5) if either 1 of the following applies:
(a) The system is affirmatively disallowed by the secretary under section 26.
(b) The secretary and department of technology, management, and budget determine that the system does not meet the applicable standards of this state after a review of the system.
(7) At least 1 time every 4 years, the secretary and the department of technology, management, and budget shall review the standards for approval of electronic notarization systems, and determine whether currently approved electronic notarization systems remain sufficient for the electronic performance of notarial acts.
Sec. 26b. (1) By March 30, 2019, the secretary and the department of technology, management, and budget shall review and may approve at least 1 remote electronic notarization platforms platform for the performance of notarial acts in this state. Except as otherwise provided in section 26c, a notary public shall not use a remote electronic notarization platform that is not approved under this section.The secretary and the department of technology, management, and budget may approve multiple remote electronic notarization platforms and may approve additional remote electronic notarization platforms on an ongoing basis.
(2) A provider or user of a remote electronic notarization platform or a notary public may submit a request to the secretary and the department of technology, management, and budget to approve a remote electronic notarization platform.
(3) Except as otherwise provided under section 26e, a notary public shall not use a remote electronic notarization platform that is not approved by the secretary and the department of technology, management, and budget under this section.
(4) (2) Subject to subsection (3), (5), in developing criteria for the approval of any considering whether to approve a remote electronic notarization platform for use in this state, the secretary of state and the department of technology, management, and budget shall create standards for remote electronic notarization platforms. In creating the standards, the secretary and the department of technology, management, and budget shall consider, at a minimum, all of the following factors:
(a) The need to ensure that any change to or tampering with an electronic record containing the information required under this act is evident.
(b) The need to ensure integrity in the creation, transmittal, storage, or authentication of remote electronic notarizations, records, or signatures.
(c) The need to prevent fraud or mistake in the performance of remote electronic notarizations.
(d) The ability to adequately investigate and authenticate a notarial act performed remotely with that remote electronic notarization platform.
(e) The most recent standards regarding remote electronic notarization promulgated by national bodies, including, but not limited to, the National Association of Secretaries of State.
(f) The standards, practices, and customs of other jurisdictions that allow remote electronic notarial acts.
(5) (3) If Except as otherwise provided in subsection (6), the secretary and department of technology, management, and budget shall approve the use of a remote electronic notarization platform for the performance of remote electronic notarizations if the system is approved or certified by a either of the following and verifiable proof of the approval or certification is provided to the secretary and the department of technology, management, and budget:
(a) A government-sponsored enterprise, as that term is defined in 2 USC 622(8), the secretary of state and the department of technology, management, and budget shall approve the platform for use in this state if verifiable proof of that approval or certification is provided to the secretary and department, unless 622.
(b) Another state of the United States.
(6) The secretary and department of technology, management, and budget may deny the use of the a remote electronic notarization platform described in subsection (5) if either 1 of the following applies:
(a) The platform is affirmatively disallowed by the secretary under section 26.
(b) The secretary and department of technology, management, and budget determine that the platform does not meet the applicable standards of this state after a review of the platform.
(7) (4) The At least 1 time every 4 years, the secretary and the department of technology, management, and budget shall review their the standards for approving remote electronic notarization platforms for use in this state , and whether the number of approved remote electronic notarization platforms are is sufficient. , at least every 4 years.
(8) (5) A notary public may perform a notarial act using a remote electronic notarization platform if either 1 or both of the following is are met:
(a) The notary public makes all applicable determinations under section 25 according to personal knowledge or satisfactory evidence, performance of the notarial act complies with section 27, and the notary public does not violate section 31 in the performance of the notarial act.
(b) The notary public, through use of the remote electronic notarization platform, personal knowledge, or satisfactory evidence, is able to identify the record before the notary public as the same record presented by the individual for notarization.
(9) (6) The notary public shall not record by audio or visual means a notarial act performed using a remote electronic notarization platform, unless the notary public discloses to the person that requested the notarial act that an audio or visual recording is being made and how the recording will be preserved, and the person consents or has previously consented to the recording. A notary public may refuse to conduct a notarial act using a remote electronic notarization platform if the person that requested the notarial act objects to an audio or visual recording of the notarial act.
(10) (7) If a notary public performs notarial acts using a remote electronic notarization platform, the notary public shall maintain a journal that records, at a minimum, each of those notarial acts. A notary public shall maintain only 1 journal for the recording of notarial acts and must keep the journal either as a tangible, permanent bound register or in a tamper-evident, permanent electronic format. A notary public shall retain the journal for at least not less than 10 years after the performance of the last notarial act recorded in it. If a notary public is not reappointed , or if his or her commission is revoked, the former notary public shall inform the secretary of state where the journal is kept or, if directed by the secretary, shall forward the journal to the secretary or a repository designated by the secretary.
(11) (8) A notary public shall make an entry in a journal maintained under subsection (7) (10) contemporaneously with performance of the notarial act, and the entry must include, at a minimum, all of the following information:
(a) The date, time, and nature of the notarial act.
(b) A description of the record, if any.
(c) The full name and address of each individual for whom the notarial act is performed.
(d) If the identity of the individual for whom the notarial act is performed is based on personal knowledge, a statement to that effect. If the identity of the individual for whom the notarial act is performed is based on satisfactory evidence, a brief description of the method of identification and the identification credential presented, if any, including the date of issuance and expiration for the credential.
(e) The fee charged, if any, by the notary public.
(12) (9) An entry made in a journal maintained by a notary public under subsection (7) (10) must also reference , but shall not itself contain , any audio or visual recording of a notarial act performed using a remote electronic notarization platform. Subject to subsection (1), a notary public must shall retain an audio or visual recording of a notarial act for at least not less than 10 years after the performance of the notarial act.
(13) (10) A notary public may designate a custodian to do any of the following tasks:
(a) Maintain the journal required under subsection (7) (10) on his or her behalf.
(b) Retain an audio or visual recording of a notarial act under subsection (9) (12) on his or her behalf. If an audio or visual recording of a notarial act is transferred to a custodian to hold on behalf of the notary public, the journal entry must identify the custodian with sufficient information to locate and contact that custodian.
(14) (11) A notarial act performed using a remote electronic notarization platform under this section that otherwise satisfies the requirements of this act is presumed to satisfy any requirement under this act that a notarial act be performed in the physical presence of a notary public.
Sec. 26e. (1) Notwithstanding any other provision of this act, a notary public described in subsection (4)(a) or (b) may use communication technology other than an electronic notarization system or remote electronic notarization platform to perform notarial acts electronically if all of the following requirements are met:
(a) The communication technology allows direct interaction between the individual seeking the notary public's services, any witnesses, and the notary public, so that each can communicate simultaneously by sight and sound through an electronic device or process at the time of the notarization.
(b) The communication technology is capable of creating an audio and visual recording of the complete notarial act and the recording is made and retained as a notarial record in accordance with section 26b(10) to (12).
(c) The individual seeking the notary public's services and any required witnesses, if not personally known to the notary public, present satisfactory evidence of identity to the notary public during the video conference, and do not merely transmit it before or after the transaction, to satisfy the requirements of this act and any other applicable law.
(d) Subject to subdivision (e), the individual seeking the notary public's services affirmatively represents that the individual is physically situated in this state or is physically located outside the geographic boundaries of this state and that 1 of the following applies:
(i) The record is intended for filing with or relates to a matter before a court, governmental entity, public official, or other entity subject to the jurisdiction of this state.
(ii) The record involves property located in the territorial jurisdiction of this state or a transaction substantially connected to this state.
(e) If an individual is physically located outside of the geographic boundaries of this state, the notary public has no actual knowledge that the individual's act of making the statement or signing the record is prohibited by the laws of the jurisdiction in which the individual is physically located.
(f) The individual seeking the notary public's services, any required witnesses, and the notary public are able to affix their signatures to the record in a manner that renders any subsequent change or modification of the remote online notarial act to be tamper evident.
(g) The individual seeking the notary public's services or the individual's designee transmits by facsimile, mail, or electronic means a legible copy of the entire signed record directly to the notary public not later than 2 business days after the date it was signed. This requirement applies regardless of the manner in which the record is signed.
(h) Upon receiving a legible copy of the record with all of the necessary signatures, the notary public notarizes the record in accordance with section 27 and transmits the notarized record back to the individual seeking the notary public's services.
(i) A record notarized under this section may be witnessed through the use of communication technology if at least 1 witness to the signing of the document is a notary public described under subsection (4)(a) or (b).
(2) The official date and time of the notarization performed under this section is the date and time when the notary public witnesses the signature via communication technology as required under this section.
(3) Notwithstanding any other law or regulation of this state, absent an express prohibition in a record against signing the record in counterparts, a record signed under this act may be signed in counterparts.
(4) A notary public may perform a notarial act using communication technology under this section if the notary public is 1 of the following:
(a) An attorney licensed to practice law in this state, or a notary public acting in the course of his or her employment with, and at the direction and under the supervision of, an attorney licensed to practice law in this state. As used in this subdivision, "attorney" does not include an attorney who is also an employee or authorized agent of a financial services provider.
(b) An employee or authorized agent of a financial services provider in the course of his or her employment or agency for that financial services provider if all of the following conditions are met:
(i) The director of the department of insurance and financial services determines that the use of communication technology is necessary to allow the employee or authorized agent to execute or record a document with a county register of deeds during a statewide state of emergency or public health order declared by the President of the United States or governor of this state.
(ii) The director of the department of insurance and financial services promulgates emergency rules to implement his or her determination under subparagraph (i) pursuant to the administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328.
(5) If a record is notarized electronically under this section, all of the following apply:
(a) The record does not need to be notarized under any other provision of this act.
(b) Compliance with this section is presumed. A person challenging a record notarized under this section may overcome the presumption by establishing that the notary public or the individual seeking the notary public's services intentionally failed to comply with a requirement described in this section.
(6) Nothing in this section prohibits or restricts a person from using an electronic notarization system or a remote electronic notarization platform otherwise approved for use to notarize a record under this act.
Sec. 27. (1) A notary public shall place his or her signature on every record upon which he or she performs a notarial act. The notary public shall sign his or her name exactly as his or her name appears on his or her application for commission as a notary public.
(2) On each record that a notary public performs a notarial act and immediately near the notary public's signature, as is practical, the notary public shall print, type, stamp, or otherwise imprint mechanically or electronically sufficiently clear and legible to be read by the secretary and in a manner capable of photographic reproduction all of the following information in this format or in a similar format that conveys all of the same information:
(a) The name of the notary public exactly as it appears on his or her application for commission as a notary public.
(b) The statement: "Notary public, State of Michigan, County of __________.".
(c) The statement: "My commission expires __________.".
(d) If performing a notarial act in a county other than the county of commission, the statement: "Acting in the County of __________.".
(e) The date the notarial act was performed.
(f) If applicable, whether the notarial act was performed using an 1 of the following:
(i) An electronic notarization system under section 26a. or performed using a
(ii) A remote electronic notarization platform under section 26b.
(iii) Communication technology under section 26e.
(g) If applicable, the specific electronic notarization system, remote notarization platform, or communication technology used to perform the notarial act.
(3) A notary public may use a stamp, seal, or electronic process that contains all of the information required under subsection (2). However, the If the notary public uses an electronic process, the text size must not be less than 10-point font. The notary public shall not use the stamp, seal, or electronic process in a manner that renders anything illegible on the record being notarized. A notary public shall not use an embosser alone or use any other method that cannot be reproduced.
(4) The illegibility of the statements required under subsection (2) or failure to use 10-point font under subsection (3) does not affect the validity of the transaction or record that was notarized.
Enacting section 1. Section 26d of the Michigan law on notarial acts, 2003 PA 238, MCL 55.286d, is repealed retroactively effective July 1, 2021.
