More on robo-signers

Yesterday I wrote about a Globe article that featured my colleague, John O'Brien, the Register of Deeds of Essex South, and his efforts against MERS and robo-signers. Yesterday I addressed MERS; today it will be robo-signers.

The issue is that several large national lenders or the servicing contractors who worked for them, would take corporate votes authorizing a particular employee to sign certain foreclosure-related documents for the bank (as we'll collectively call the lenders and their servicing companies). With the collapse of the real estate market, however, there were too many documents from places too far away for that authorized person to sign in a timely fashion. Instead of the bank formally adding more people to the list of those who can sign on the bank's behalf, the bank left its employees to fend for themselves. Many took to signing the name of the one authorized employee to any documents that passed the non-authorized employee's desk. In all of these cases, a notary public acknowledged the signatures, affirming that the authorized signer, who very well could have been in another time zone, "personally appeared and acknowledged the foregoing to be his free act and deed." These documents were then presented for recording and were recorded at registries of deeds across the country.

Register O'Brien has obtained the services of a forensic document examiner who has identified several dozen names whose signatures on real estate documents were made by different people. O'Brien believes these documents are forgeries and is now refusing to record any documents signed by the previously identified "robo-signers" unless they are accompanied by affidavits attesting to the accuracy of the signatures and acknowledgements. Instead of signing such affidavits, the banks have re-executed at least 14 documents in this category with other authorized employees signing for the bank.

In general, registries do not determine the authenticity of documents. If, on its face, a document has been signed and acknowledged, it's recorded. Claims of forgery or fraud are then directed to the Superior Court for a judicial determination. Common sense, however, tells me that this rule is not absolute. If I no with absolute certitude that a document is a forgery, I believe I would be justified in rejecting it.

The question then becomes "what is absolute certitude of forgery?" and I'm not sure what the answer is. I am sure that it requires a very high standard of proof because registries should not be recording documents based on a mere suspicion or hunch that they are forgeries. O'Brien has the opinion of an expert witness, which is undoubtedly strong evidence that someone other than the person name signed that person's signature. But this case gets more complicated because it implicates various aspects of the law of agency. I haven't studied that in any depth for twenty-five years, but I do recall that in addition to actual authority to bind a principal (as the case of the person authorized to sign on behalf of the corporation) there are also things like implied authority and ratification. I'm not suggesting that either of those documents do apply here, only that they might. Consequently, there are many unanswered questions about this issue. As I suggested yesterday, a court case that resolves this would be beneficial to everyone.