SB 2782: Notary Public; Bureau of Conveyances; Fraudulently Notarized Recorded Instruments

A BILL FOR AN ACT

RELATING TO NOTARIES PUBLIC.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  The legislature finds that deed fraud devastates property owners across the State, as well as their heirs, purchasers, realtors, lenders, and the public.  Currently, the only remedy is to hire an attorney and petition the court to expunge the fraudulent deed, an expensive and time-consuming process that never completely restores the financial loss of the property owner.  The legislature believes that protections for state property owners may be enhanced by empowering notaries to act as a safeguard to the integrity and responsibility of deeds and other recorded instruments.

     Accordingly, the purpose of this Act is to require the bureau of conveyances to:

     (1)  Notify affected parties of any recorded instrument that was purportedly fraudulently notarized when attested to the bureau by the purported notary public;

     (2)  Allow affected parties of purportedly fraudulently notarized record instruments to void the instruments; and

     (3)  Allow title holders to suspend additional recordings on their title, unless given prior authorization by the title holder, subject to certain limitations.

     SECTION 2.  Chapter 502, Hawaii Revised Statutes, is amended by adding two new sections to part V to be appropriately designated and to read as follows:

     "§502-A  Fraudulent notarial acts; notice; opportunity to void.  The bureau of conveyances shall notify any party to a recorded deed or interest in real property that contains a fraudulent notarial act or seal if the purported notary public whose notarial act or seal was fraudulently used attests to the bureau of conveyances that the notarial act or seal was fraudulently administered, authorized, or authenticated.  The party notified pursuant to this section may void the purportedly fraudulently notarized deed or interest in real property.

     §502-B  Notice of attempted recording; suspension of recording.  The bureau of conveyances shall allow a holder of title to real property to suspend the recording of any notarized document affecting the title, except liens or judgments against the subject real property or the title holder, until the title holder releases the suspension.  For a real property title that is suspended, the bureau of conveyances shall notify any holder of title to real property of any attempt to record a notarized document affecting the title.  This suspension shall be lifted automatically if the real property is foreclosed upon."

     SECTION 3.  Section 456-26, Hawaii Revised Statutes, is amended to read as follows:

     "[[]§456-26[]]  Validity of notarial acts.  Except as otherwise provided in [section] sections 456-14(b)[,] and 502-A, the failure of a notary public to perform a duty or meet a requirement specified in this chapter does not validate or invalidate a notarial act performed by the notary public.  The validity of a notarial act under this chapter does not prevent an aggrieved person from seeking to invalidate the document or transaction that is the subject of the notarial act or from seeking other remedies based on the laws of this State other than this chapter or based on the laws of the United States.  This section shall not be deemed to validate a purported notarial act performed by a person who does not have the authority to perform notarial acts."

     SECTION 4.  In codifying the new sections added by section 1 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

     SECTION 5.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 6.  This Act shall take effect on July 1, 2050.

Report Title:

Notary Public; Bureau of Conveyances; Fraudulently Notarized Recorded Instruments

Description:

Requires the Bureau of Conveyances to notify an affected party when any recorded instrument was purportedly fraudulently notarized, when attested to by the purported notary public.  Requires the Bureau of Conveyances to allow an affected party to void the recorded instrument that was purportedly fraudulently notarized.  Requires the Bureau of Conveyances to allow title holders to suspend additional recordings on their title, unless given prior authorization by the title holder, subject to certain limitations.  Effective 7/1/2050.  (SD1)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

A BILL FOR AN ACT

relating to notaries public.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  Chapter 502, Hawaii Revised Statutes, is amended by adding two new sections to part V to be appropriately designated and to read as follows:

     "§502-A  Fraudulent notarial acts voidable.  The bureau of conveyances shall void any recorded deed or interest in real property that contains a fraudulent notarial act or seal if the purported notary public whose notarial act or seal was fraudulently used attests to the bureau of conveyances that the notarial act or seal was fraudulently administered, authorized, or authenticated.

     §502-B  Notice of attempted recording; suspension of recording.  The bureau of conveyances shall allow a holder of title to real property to suspend the recording of any written instrument affecting the title, except liens or judgments against the subject real property or the title holder, until the title holder releases the suspension.  For real property title that is suspended, the bureau of conveyances shall notify any holder of title to real property of any attempt to record a written instrument affecting the title.  This suspension shall be lifted automatically if the real property is foreclosed upon."

     SECTION 2.  Section 456-26, Hawaii Revised Statutes, is amended to read as follows:

     "[[]§456-26[]]  Validity of notarial acts.  Except as otherwise provided in [section] sections 456-14(b)[,] and 502-A, the failure of a notary public to perform a duty or meet a requirement specified in this chapter does not validate or invalidate a notarial act performed by the notary public.  The validity of a notarial act under this chapter does not prevent an aggrieved person from seeking to invalidate the document or transaction that is the subject of the notarial act or from seeking other remedies based on the laws of this State other than this chapter or based on the laws of the United States.  This section shall not be deemed to validate a purported notarial act performed by a person who does not have the authority to perform notarial acts."

     SECTION 3.  In codifying the new sections added by section 1 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

     SECTION 4.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 5.  This Act shall take effect upon its approval.

Report Title:

Notary Public; Bureau of Conveyances; Fraudulently Notarized Recorded Instruments

Description:

Requires the Bureau of Conveyances to void any recorded instrument that was fraudulently notarized when attested to by the purported notary public.  Requires the Bureau of Conveyance to allow title holders to suspend additional recordings on their title, unless given prior authorization by the title holder, subject to certain limitations.

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

STAND. COM. REP. NO. 2515

Honolulu, Hawaii

RE:     S.B. No. 2782

        S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2026

State of Hawaii

Sir:

     Your Committee on Water, Land, Culture and the Arts, to which was referred S.B. No. 2782 entitled:

"A BILL FOR AN ACT RELATING TO NOTARIES PUBLIC,"

begs leave to report as follows:

     The purpose and intent of this measure is to require the Bureau of Conveyances to:

     (1)  Void any recorded instrument that was fraudulently notarized when attested to the Bureau of Conveyances by the purported notary public; and

     (2)  Allow title holders to suspend additional recordings on their title, unless given prior authorization by the title holder, subject to certain limitations.

     Your Committee received testimony in support of this measure from the Department of Commerce and Consumer Affairs and Hawaiʻi Association of REALTORS.

     Your Committee received comments on this measure from the Department of the Attorney General, Department of Land and Natural Resources, and Hawaii Financial Services Association.

     Your Committee finds that deed fraud devastates property owners across the State, as well as their heirs, purchasers, realtors, lenders, and the public.  Currently, the only remedy is to hire an attorney and petition the court to expunge the fraudulent deed, an expensive and time-consuming process that never completely restores the financial loss of the property owner.  This measure will enhance protections for property owners by empowering notaries to act as a safeguard to the integrity and responsibility of deeds and other recorded instruments.

     Your Committee acknowledges the recommendations raised in testimony by the Department of the Attorney General regarding the process by which the Bureau of Conveyances may void a contract, as well as regarding the public purpose of this measure and a clear nexus of each provision with this measure's title.  Therefore, amendments to this measure are necessary to address these concerns.

     Accordingly, your Committee has amended this measure by:

     (1)  Clarifying that the Bureau of Conveyances shall notify affected parties that the Bureau has received attestation from a notary public whose notarial act or seal was purportedly fraudulently used on a written instrument of the affected party;

     (2)  Inserting language that allows affected parties to void purportedly fraudulent written instruments;

     (3)  Specifying that the Bureau shall allow title holders to suspend the recording of any notarized document affecting the title, under certain conditions;

     (4)  Inserting legislative findings that explain the significant public purpose of the measure and reflect its amended purpose;

     (5)  Inserting an effective date of July 1, 2050, to encourage further discussion; and

     (6)  Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

     As affirmed by the record of votes of the members of your Committee on Water, Land, Culture and the Arts that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2782, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 2782, S.D. 1, and be referred to your Committee on Judiciary.

Respectfully submitted on behalf of the members of the Committee on Water, Land, Culture and the Arts,