Notary and employer liable for false acknowledgment - Reservation discovered - Employer liable - Court opinion is a “textbook” on acknowledgments

Sep 21, 2026

Uploaded by Oliver

Legal discussion on false acknowledgment in notarial practice, focusing on a California real-estate transaction where a mineral-rights reservation was omitted from the deed of trust and later added without the Gartons’ presence during notarization. The text explains material alteration, breach of the notary’s duty, and employer liability when the notary works for a title company. It also reviews Idaho’s treatment of acknowledgments and priority of mortgages, including defective certificates and recording notice.

LanguageEnglish

CategoryResearch & Report

FormatPDF

Pages5

Reading Time13 min

AccessFree to download

Reservation discovered

Employer liable

Court opinion is a “textbook” on acknowledgments

Mortgage overlooked

Acknowledgment required

Maryland residency requirement dropped from 2 to 1 year

# Notaryandemployerliable for falseacknowledgment In 1953,the owner of a piece of real.estate in California sold the land but re-served to himself all oil,gas and mineralrights.In 1977,Charles and Burleen Gartonbought this land.The title company thatexamined the title for the Gartons did notdiscover this reservation and the deed oftrust frorn the Gartons to the seller did notcontain the reservation of mineral rightsThe Gartons signed the deed of trust andtook title to the property. # Reservation discovered After the deed of trust had been signedthe title company discovered the reserva-tion of the mineral rights.It then alteredthe deed of trust by adding an exceptionsetting forth the reservation of the mineralrights.Then a notary who worked for thetitle company completed the certificate ofacknowledgment on the deed of trust butwithout the Gartons beingpresent.This,ofcourse,was a false acknowledgment. When the Gartons discovered what hadhappened they sued the title company andthe notary for improper notarization. The title company and the notaryclaimed that there could be no liability forthe false acknowledgment because theGartons conceded that the signatures onthe deed of trust were their signatures.TheCourtof Appeals,Third District,disagreed.The court said:"The deed of trust whichwas acknowledged and recorded was notthe deed oftrust which was erecuted by ltheGartonsl.The addition of the exception forthe reservation of mineral rights in thedeed of trust was a material alteration ofthe instrument which had been executed.By falsely taking the acknowledgment ofthis altered document [the notary]breached his duty as a notary.This is truewhether[the notary]intentionally took theacknowledgment with knowledge that thedocument had been altered as alleged**ordid so negligentlv.*** # Emplover liable The court said that since the notaryworked for the title cornpany under July/August 1980 Committees at work;all members can help # Court opinion isa“textbook”onacknowledgments The Supreme Court of Idaho recentlydecided a case involving an acknowledg-ment taken byanotary public.Because theopinion is that case tells so much aboutacknowledgments we are reprinting sub-stantially all of it. The case involved the relative prioritiesof several financial institutions who hadlent money on the same piece of propertyand had taken mortgages in return. Whenever anyone lencis money andtakesa mortgage on real estate as securitythe first thing they do is to search the realestate records to see if the person whowants to borrow the money actually ownsthe property and also to see if there are anyother mortgages on the property that havebeen recorded.(If the first one to take amortgage fails to record it and the secondone does,the second one will generallyhave priority.) Mortgage overlooked The property involved was first ownedby Sam and Jolene Hendricks.They exe-cuted two mortgages on the property:oneto MIC and the second to Farm BureauFinance.Both were recorded in order inwhich they were executed. Later the Hendrickses sold the propertyto the Carneys who financed the purchasewith money borrowed from Utah Mort-gage executing a mortgage to secure theloan. When Utah Mortgage searched the rec-ords they discovered the mortgage to MICbut did not see the one to Fa:m BureauFinance. Later Farm Bureau Finance brought anaction to foreclose on its mortgage andnamed Utah Mortgage as one of the defen-dants.Utah Mortgage claimed that itsmortgage should be given preference overFarm Bureau's because the acknowledg-ment on the Farm Bureau mortgage wasfatally defective because the notary hadfailed to fill in the name of the acknowl-edger in her certificate of acknowledg-ment.Farm Bureau was saying,in effect,that since the acknowledgment was defec-(Continued on page 2) ASN's five standing committees havestarted their work and have appealed to allmembers to siubmnit ideas and suggestions The membership of each cammitteemust be kept small to faci

FAQs

Why was the acknowledgment considered false in the mineral-rights deed of trust case?

A notary completed the certificate of acknowledgment on the altered deed of trust without the Gartons being present, creating a false acknowledgment.

What did the court say about the deed of trust that was acknowledged and recorded?

The court stated the deed of trust that was acknowledged and recorded was not the same deed of trust executed by the Gartons because the later addition of the mineral-rights exception was a material alteration.

How did faulty acknowledgments relate to mortgage priority in the described Idaho matter?

The discussion explains that mortgagees search records for existing recorded instruments and then disputes can arise when acknowledgments are defective, affecting whether the instrument should be considered to give constructive notice after recording.

Sep 21, 2026

Uploaded by Oliver