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Do notarizations affect Colorado business contract disputes?

A Larimer County court determines whether a legal agreement is binding only after establishing the parties entered a contract. That sounds simple, but business contract disputes can be stalled when one party alleges the agreement was never signed. Extended litigation adds to costs, which can be prevented when contracts are notarized.

A notary public is an authorized, neutral person who affirms and witnesses the signing of a contract. Notaries also validate that parties are who they claim to be. According to the National Notary Association, Colorado notary publics are trained and tested state residents, 18 or older, with no felony or recent dishonesty-related misdemeanor convictions.

You may have had to hunt down a notary to witness your signature for a specific purpose, but the use of notaries isn't as widespread as it once was. Notarizations aren't required for as many contracts today as they were in the past. However, it is worth the effort to have a notary on hand when you sign a business agreement, if only to prove to a court the signing took place.

Parties in legal disputes would have a difficult time claiming a contract wasn't signed if signatures were notarized. In fact, federal courts and several state courts consider all notarized signatures to be authentic. Therefore, notarized signatures generally mean parties have no room to dispute whether a contract was signed.

Notaries can make mistakes, but government rules often require notaries to be bonded. The notary's insurer may be liable for any damages your company suffers if a notary fails to execute his or her job properly. The expense is not yours to absorb.

The services of a notary, frequently provided by attorneys, are nominal compared to the costs of fighting a legal opponent's claims about signatures on a contract. You may want to reexamine any business dealings with parties who hesitate to permit a notary to witness a contract signing.

Source: Entrepreneur, "Avoiding Contract Disputes" accessed Mar. 04, 2015

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