A registered agent is typically hired to receive legal documents and certified mail, as well as accepting service of process on behalf of a business during normal business hours. But just because that’s the main purpose of a registered agent doesn’t mean it’s impossible for a registered agent to go against the status quo and refuse service of process.
In this article we’ll discuss what happens if your registered agent refuses to accept service of process on behalf of your limited liability company.
Can Your Registered Agent Refuse Service of Process?
According to abclegal.com, yes. Any person that’s authorized to accept service of process on behalf of a limited liability company or business can refuse service of process.
This means that another defendant listed in the document, someone else who lives at the defendant’s house (like a roommate or spouse), the manager of a business, or a registered agent all have the ability to either accept or refuse service of process.
What Is a Registered Agent?
A registered agent is a person or business entity that is available at your registered office address during business hours to receive service of process, mail, and tax notices, as well as important correspondence from the Secretary of State, on behalf of your company.
Using either mail forwarding or an online document-management system, your registered agent will ensure that you’re notified about any important documents you might receive.
For more information about registered agents, including if your business needs one, read my comprehensive guide to registered agents.
What Happens If Service of Process Is Refused?
If a registered agent refuses personal service, then one of two things can happen.
If an authorized person, like a registered agent, is hostile or violent towards a process server, refuses to accept the service of process or makes a run for it, then the process server has the right to set the legal papers down at their feet and walk away. This is considered valid service in many states and is called “drop service.”
Basically, the process server has the legal right to get the last word in if a registered agent moves to refuse service of process. Of course, this depends on the rules about serving people in the state because drop service isn’t legal in some places.
If your registered agent doesn’t receive service of process, then it will start a process known as substituted service. If your registered agent isn’t available at your business’s listed street address or refuses the paperwork and personal service isn’t an option, then the next step is for the process agent to deliver the paperwork to another address.
This could mean that the process agent will deliver the process to the home of the defendant, leave it with a family member or spouse of the defendant, leave it posted in a public place (like on the door of the courthouse), or send it to the governing agency in your state (usually the Secretary of State).
If the latter occurs, then it’s pretty likely that your business is in trouble. A lawsuit is now taking place against your business, but you’re completely oblivious because you never received the court papers. And if you’re not able to respond in a timely manner, it’s possible that your company will have a default judgment issued against it, which could be costly.
Another thing that process servers can do if a registered agent can’t be served with reasonable diligence is send the notice via certified mail to your home address, or your listed office or business address.
If your agent for service of process neglects its duties, or if you’re found to not have one in a state where you’re required to have one, there could be serious legal and financial consequences for your business.
The Secretary of State could revoke your company’s good standing, which would immediately disqualify your company from most business loans, prevent it from expanding to other states, and even prevent it from conducting business at all.
If you own a limited liability company, the Secretary of State could dissolve your company through administrative dissolution as well.
What Is Service of Process?
In the United States, it’s illegal for someone to sue you and hold legal proceedings without even informing you about them. So, before a lawsuit can take place the defendant must receive notice of the suit, which is called process.
The process of serving someone legal process is called service of process. A service of process is a legal notification that you or your company is being sued. Without proper service, litigation can’t continue. In addition to initial complaints to announce a lawsuit, a service of process may also include a summons, subpoena, writ, and other document from a court.
Conclusion
Your registered agent or agent for service of process can refuse service of process on behalf of your business. Because you don’t want to trifle with the court system, ensuring orderly and legal acceptance of service of process is best. As such, you might want to hire a professional registered agent service rather than an individual amateur.
If you’d like more information about registered agents, or about registered agent providers, read my guide on the Best Registered Agent Services.
If you haven’t officially established your business and want to know more about the formation process, then check out my guide on How to Start an LLC. And if you want some additional help during the formation process then read the Best LLC Formation Services.
