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Do You Know Who Your Registered Agent Is?

Jim Slaughter

Jim Slaughter

North Carolina corporations, whether for-profit or nonprofit, must have a registered agent name filed with the NC Secretary of State. Planned communities (i.e., homeowner associations) created on or after January 1, 1999 by statute must be incorporated. And almost all homeowner and condominium associations in North Carolina ARE incorporated, regardless of when they were created. So an important question is, “Do you know who your registered agent is?”

Finding Your Registered Agent

The process of determining your current registered agent is fairly straightforward. Just visit the Secretary of State’s corporate search page and search for your corporate name (be careful, as different corporations often have similar names). Once you find your currently listed registered agent, you may have a second questions: “Who the heck is that?”  We often find that corporations—and especially community associations—have never updated their registered agent information. So the listed registered agent name could be:

  • The attorney who set up the corporation many years ago
  • A long-ago past association officer who no longer has anything to do with the association
  • A past owner who has died or moved away

Any of these 3 options are a bad outcome because it means that important legal papers sent to the registered agent likely won’t make it to the association.

Why the Registered Agent Matters

The responsibilities of a registered agent are serious and significant to a corporation. Any service of process (read “lawsuit”) or legal notice sent to the corporation gets served on the registered agent. Department of Revenue or IRS notices would also be sent to the registered agent. The registered agent is then supposed to make certain the documents get into the hands of decision-makers ASAP. The consequences for failing to do so can be catastrophic for the corporation. We know of lawsuits that were served on out-of-date registered agents that ignored the notice, and legal proceedings moved forward against the association without the board knowing anything was going on!

As a result, it is essential to have a registered agent who meets the following criteria:

  1. completely trusted to get any received documents where they need to go
  2. has a stable and permanent address that should work for years

If your registered agent can’t meet these criteria, you need a different registered agent.

Selecting a Registered Agent

While there is nothing improper with having a member of the community serve as registered agent, the usual concern is that most homeowners don’t plan to be involved with association leadership forever. (And regularly updating registered agent information with the Secretary of State can take time and money.) As a result, many associations these days use an outside party to serve as registered agent–whether a registered agent service, a community management company for the association, or the association lawyer. Another reason some corporations prefer a third-party registered agent is that it keeps some individual’s contact information off the online Secretary of State database.

Professional service of process companies can be found online and typically charge $50-$100 per year. Their sole responsibility is to mail received papers to the last known address of the corporation. While some management companies are also willing to serve as an association’s registered agent, others don’t wish to assume the possible responsibility/liability. If your management company is your registered agent, make certain that information is updated in the event of a change in community manager.

Finally, attorneys also often serve in the role of registered agent. While this is more in the nature of a service by a law firm (due to the low cost and lack of regularly activity by a registered agent), the advantage is that most attorneys will go to significant steps to track down the appropriate person to get important papers to in a corporation, even if they no longer do regular work for the client. In the event you need a registered agent and do not have anyone who wishes to serve in that capacity, feel free to contact any of the attorneys at Black, Slaughter & Black to discuss possible options.

Author: Jim Slaughter
Articles have been Reprinted with permission from Black, Slaughter, Black.

* These articles and related content on this website are provided without warranty of any kind and in no way constitute or provide legal advice. You are advised to contact an attorney specializing in Association Management for legal advice related to your specific issue and community. Some articles are provided by thrid parties and online services. Display of these articles does in no way endorse the products or services of Community Association Management by the author(s).