Senate Enrolled Act No. 340 which goes into effect July 1, 2020, will now require that any document to be recorded in Indiana have both a notarized signature of grantor and a notarized signature of a witness. Currently, Indiana Code 32-21-2-3 requires any document to be recorded must be either acknowledged by grantor or proved before a list of specified persons. The purpose of the acknowledgement is to validate that the instrument was the act of the person who executed it[1] and includes a written certificate of acknowledgement prepared by a public official, typically a notary public.[2] As for the other means of having a document recorded, Indiana’s only guidance regarding proving a document, is in Indiana Code 32-21-2-6 which states that a deed may be proved according to the rules of common law before an authorized officer.
Though the change in Indiana Code 32-21-2-3 from “or” to “and” is small, it requires that any recorded document contain both an acknowledgement by grantor and that the document be proved before one of the listed individuals, including a notary public. In practice, this can be accomplished with a notarized signature of grantor, as is now common practice, and a notarized signature of a witness.
No official guidance has been provided yet by the Indiana Recorders Association, but it seems unlikely that recorders’ offices will reject a deed, mortgage, or other instrument solely for the lack of a notarized witness signature. Further, Indiana Code 32-21-4-1(c) provides protection in situations where an instrument is recorded, but does not comply with all of the requirements of Indiana Code 32-21-2-3, it will be considered validly recorded and provide constructive notice to an bona fide purchaser. Yet, the protection provided by this statute should be interpreted cautiously, as it may still be possible for a bankruptcy trustee or other parties to attempt to invalidate a mortgage if the instrument does not substantially comply with the recording statutes in Indiana.[3]
