Debtor fails to show signature was forged

Where a bank filed claims against the debtor based on personal guarantees signed by the debtor and his late wife, and the debtor claimed his signature was forged on the documents, his objections were overruled. He failed to rebut the presumption that the notarized documents are valid and that the notaries performed their duties properly.

Background

Summit Community Bank has filed claims against the debtor, Byron F. David, based upon personal guarantees he and his late wife allegedly signed. David maintains that his signatures on the guarantees underlying claims 3-3, 5-3, 6-3 and 7-3 were forged.

This matter is before the court pursuant to the district court’s opinion and order reversing this court’s judgment with respect to David’s objections to 3-3, 5-3, 6-3 and 7-3. In particular, this court must determine under Murdock v. Nelms, 212 Va. 639 (1972) whether the debtor produced evidence showing “fraud or nonappearance” sufficient to rebut the presumption that the notarized documents were properly notarized and therefore valid. Additionally, because this court’s judgment relied in part on the Cindy Vu fraud examination report, which was not admitted into evidence, this court must review the debtor’s claim objection absent consideration of that report.

Analysis

The court cannot find that the debtor has proven by clear and convincing evidence that a nonappearance or fraud has occurred. Ms. LoCasio, who testified regarding what she saw as evidence of fabricated documents found in the David home and Ms. David’s alleged ability and propensity to falsify financial documents, did not identify any documents that related to the loans and guarantees at issue in this matter.

Conversely, the notaries, Ms. Melby and Ms. Self, testified that their usual procedures when notarizing documents were to require the person signing to be present. Debtor’s only evidence presented in support of nonappearance is his testimonial denials that he appeared before the notaries in question.

Viewing the evidence surrounding the notaries as a whole, the court finds that the debtor has failed to produce clear and convincing evidence sufficient to rebut the presumption that the notarized documents are valid and that the notaries performed their duties properly. If mere denials were sufficient to rebut the presumption afforded to notaries and the documents they notarize, the presumption would be worthless.

The only other relevant additional admissible evidence before the court consists of the testimony and expert reports of Mr. Hargett and Mr. Morris. The court notes at the outset that the handwriting experts do not directly speak to whether Mr. David appeared before the notary. Indeed, the handwriting experts testified with respect to the debtor’s purported signatures and the documents themselves — issues that the presumption afforded to notaries would seem to foreclose review of (absent the debtor rebutting such presumption).

Even if the debtor had rebutted the presumption, the court finds that the handwriting evidence does not establish fraud or forgery by clear and convincing evidence. Because debtor has failed to rebut the notary presumption and has not otherwise proven forgery by clear or convincing evidence, he has also failed to shift the burden of proof to Summit for purposes of the debtor’s objections to claims 3-3, 5-3, 6-3 and 7-3.

Debtor’s objections to claims 3-3, 5-3, 6-3 and 7-3 overruled.

In re: Byron F David, Case No. 18-12396, Sept. 30, 2022. EDVA Bankr. at Alexandria (Kindred). VLW No. 022-4-024. 10 pp.