The Importance of Due Diligence in Notarization: Verifying Identities and Preventing Fraud

TLDR: This case highlights the critical importance of a notary public’s duty to verify the identity of signatories and ensure the voluntariness of their actions. Failure to do so can result in disciplinary action, including suspension from the practice of law, as it undermines the integrity of public documents and the legal system.

A.C. No. 4369, November 28, 1997

Introduction

Imagine discovering that a property you thought you legally owned is now subject to dispute because the notary who handled the deed of sale didn’t properly verify the identities of the parties involved. This scenario underscores the critical role notaries public play in ensuring the integrity of legal documents. They are entrusted with the responsibility of verifying identities, witnessing signatures, and administering oaths, thereby preventing fraud and misrepresentation.

In Pike P. Arrieta v. Atty. Joel A. Llosa, the Supreme Court addressed the serious issue of a notary public notarizing a deed of sale with deceased individuals listed as signatories. This case serves as a stark reminder of the stringent duties and responsibilities placed upon notaries public and the consequences of failing to uphold them.

Legal Context: The Notarial Law and Its Importance

The act of notarization carries significant legal weight. It transforms a private document into a public document, making it admissible in court without further proof of authenticity. This is why the law imposes strict requirements on who can act as a notary public and how they must perform their duties.

Public Act No. 2103, Section 1, governs the acknowledgment of documents. It mandates that the person acknowledging the instrument must appear before the notary public or authorized officer. The notary must certify that the person is known to them, is the same person who executed the document, and acknowledged it as their free act and deed.

As the Supreme Court emphasized in this case, “It is thus clear from the foregoing that the party acknowledging must appear before the notary public or any person authorized to take acknowledgment of instruments or documents.” This requirement ensures that the notary can personally verify the identity of the signatory and confirm that they are acting voluntarily.

Case Breakdown: The Deed of Sale and the Deceased Vendors

The case began when Pike P. Arrieta filed a complaint against Atty. Joel A. Llosa, seeking his disbarment. The core of the complaint was that Atty. Llosa notarized a Deed of Absolute Sale, falsely certifying that Edelina T. Bonilla, Jesus T. Bonilla, and Leonardo P. Toledano were parties and signatories, when, in reality, all three had already passed away prior to the execution of the deed.

Here’s a breakdown of the timeline and key events:

• March 24, 1993: Atty. Llosa notarized the Deed of Absolute Sale.
• Prior to March 24, 1993: Jesus T. Bonilla (August 22, 1992) and Leonardo P. Toledano (November 1, 1992) had already died.
• Atty. Llosa’s Defense: He claimed to have verified the signatures and identities of the signatories before notarizing the document.
• Complainant’s Change of Heart: Initially, Arrieta sought dismissal of the complaint, claiming it was a misunderstanding.

Despite the complainant’s attempt to withdraw the complaint, the Supreme Court proceeded with the case, recognizing the importance of upholding the integrity of the notarial process. The Court underscored the notary’s responsibility by stating:

“By affixing his notarial seal on the instrument, he converted the Deed of Absolute Sale, from being a private document into a public document. By certifying the Deed, respondent, in effect, proclaimed to the world (1) that all the parties therein personally appeared before him; (2) that they are all personally known to him; (3) that they were the same persons who executed the instruments; (4) that he inquired into the voluntariness of execution of the instrument; and (5) they acknowledged personally before him that they voluntarily and freely executed the same.”

The Court emphasized that notarization is not a mere formality but a crucial act invested with substantial public interest. Notaries must exercise utmost care in performing their duties to maintain public confidence in the integrity of legal documents.

Practical Implications: Protecting Against Fraud and Misrepresentation

This case highlights the importance of due diligence in notarization and its impact on various transactions. It serves as a cautionary tale for notaries public and provides valuable lessons for individuals and businesses relying on notarized documents.

Here are some key takeaways:

• For Notaries Public: Always verify the identity of signatories with reliable identification documents and ensure their physical presence during notarization.
• For Individuals and Businesses: When dealing with notarized documents, ensure that the notary is reputable and follows proper procedures. Request to see the notary’s identification and commission.
• For Legal Professionals: Emphasize to clients the significance of proper notarization and the potential consequences of failing to comply with notarial requirements.

The Supreme Court’s decision underscores that any deviation from these standards can have serious repercussions, including disciplinary action against the notary and potential legal challenges to the validity of the notarized document.

Key Lessons

1. Verify Identity: Always confirm the identity of signatories using valid identification.
2. Ensure Presence: Signatories must be physically present during notarization.
3. Uphold Integrity: Notarization is a solemn act that demands utmost care and adherence to legal requirements.

Frequently Asked Questions

Q: What is the role of a notary public?

A notary public is an officer authorized to administer oaths, witness signatures, and certify documents. Their role is to deter fraud and ensure the integrity of legal transactions.

Q: What happens if a notary public fails to properly verify the identity of a signatory?

Failure to verify identity can lead to disciplinary action, including suspension or disbarment, as well as potential legal challenges to the validity of the notarized document.

Q: Can a document be notarized if the signatory is not physically present?

Generally, no. The signatory must be physically present before the notary public to verify their identity and ensure the voluntariness of their actions.

Q: What types of identification are acceptable for notarization?

Acceptable forms of identification typically include government-issued photo IDs, such as passports, driver’s licenses, and national identification cards.

Q: What should I do if I suspect that a notarized document is fraudulent?

If you suspect fraud, consult with an attorney to explore your legal options. You may need to file a complaint with the relevant authorities and challenge the validity of the document in court.

ASG Law specializes in legal document review and fraud prevention. Contact us or email hello@asglawpartners.com to schedule a consultation.