Do You Know Who Your “Registered Agent” Is?
No, your Registered Agent is not some double-naught spy on a clandestine mission to ferret out rules violations in your neighborhood. Every corporation is required by law to designate a Registered Agent (“R/A”) – a person or company physically present in the state, upon whom legal process will be served in proceedings involving or affecting the corporation. Almost all HOAs are established as non-profit corporations, and those that are must appoint a person or company to serve as R/A by filing a form with the Secretary of State’s office. This can be a board member, your property manager (either a person or the company), your lawyer, accountant, or any other responsible person (or company) whom you trust will notify the board in the event any legal notices are received. To verify your listing, use these links: http://www.secretary.state.nc.us/corporations/CSearch.aspx – for North Carolina corporations. http://www.scsos.com/search%20business%20filings – for South Carolina corporations. To illustrate the importance of having a current R/A on file with the Secretary of State, allow me to share a “War Story” with you. Many years ago, I represented a certain condo association. The condo association was formed in the early 1980’s. As is often the case, the developer’s attorney filed the Articles of Incorporation for the HOA with the Secretary of State, and listed himself as the R/A, with his office address as his mailing address. Over the years, no one ever thought to check or update the R/A information. In the mid-90’s, a homeowner filed a lawsuit against the HOA, and as the law requires, mailed the summons and complaint to the R/A at the address on file with the Secretary of State. The mail was returned to him as undeliverable. In accordance with state law, the homeowner then served the summons and complaint on the Secretary of State’s office – who simply forwards it on to the address of the R/A on file – and this is considered valid service of process on a corporation. The problem though, was that the office building where the R/A’s office was (remember, the R/A was the developer’s attorney) had been torn down, and had become the site of the new county jail. As a result, the HOA never received the summons and complaint, and didn’t learn about the lawsuit until it was too late. The homeowner obtained a default judgment against the HOA, and the HOA first learned of the lawsuit and resulting judgment when a Sheriff’s Deputy showed up at the property manager’s office, seeking to levy on the HOA’s bank account to satisfy the judgment. We filed a motion to set aside the judgment for lack of notice, but the presiding judge refused, saying it was incumbent upon the HOA to keep its R/A information up-to-date, and the HOA must suffer the consequences for failing to do so. Lesson learned: make sure you know who your Registered Agent is. If you need to change the information, the forms can be downloaded from the Secretary of State’s corporations division website.