The Employer's Loan Documents
Tom is a Maine notary public and an administrative assistant at a car dealership. His manager asks him to notarize a title transfer and loan documents for a customer buying a car. Tom's annual bonus depends on the dealership meeting its monthly sales goal. The customer appears without a driver's license or other photo ID. The manager says, 'I've known him for years; just notarize it.' Tom has never met the customer. The customer is cooperative but has no documents. Tom's seal is in the office, and the finance manager is waiting.
1. Does Tom have a conflict of interest in notarizing these documents?
Read the worked answer
Yes, or at least a serious appearance of conflict. Tom's bonus depends on the dealership meeting its sales goal, so he has a direct financial incentive to complete the transaction. A notary should not perform a notarial act when the notary has a personal financial interest in the transaction or is acting under pressure from an employer who benefits from the act. Even if Tom believes he can be impartial, the combination of bonus pressure and employer direction undermines the credibility of the notarization.
2. May Tom rely on the manager's statement that he knows the customer?
Read the worked answer
No. The notary must personally know the signer or obtain satisfactory evidence of identity. Another person's knowledge does not transfer to Tom. The manager is also financially interested in the sale, so he is not a neutral credible witness. Tom cannot rely on the manager's assurance, and he cannot notarize based only on the customer's cooperative attitude. Without acceptable identification or a proper credible witness, Tom lacks satisfactory evidence.
3. What should Tom do, and what are the risks if he proceeds?
Read the worked answer
Tom should decline to notarize unless he can satisfy the identification requirement independently and the conflict is removed or adequately addressed. He should tell his manager that notarial duties are personal and cannot be delegated to the employer's convenience. If he proceeds anyway, the notarization may be challenged, he may face discipline for failing to identify the signer and for acting with a conflict, and he may face civil liability if the transaction harms someone. He should document nothing false and should not let the finance manager pressure him into an improper act.