Part 2: The Perfect Storm
Choosing an officer or owner as registered agent is the calm before the storm. The storm comes when that registered agent inevitably must go away from their place of business for a business or personal matter. The lesson is that it’s worth it to pay a little bit of money up front to not meet the huge risk that awaits you.
The most expensive risk of not having an attorney registered agent is likely receiving a default judgment. A default judgment is when the judge renders a decision in favor of the other party without ever hearing your side. The judgment is an enforceable court order, which means that your company’s assets will be legally be seized to pay it. Another costly risk of not appointing an attorney registered agent is that most attorneys charge extra when they have to drop what they’re doing to immediately address a new matter. You can easily find yourself in this situation if you’re late to receiving notice.
Here’s a “perfect storm” scenario to help explain why you want to appoint an attorney registered agent rather than an owner. If the registered agent of your company is the owner, and there is a lawsuit filed against the company, a server will be sent to the address of the owner as the registered agent of the company. When the owner needs to leave town for a two-week business trip to oversee the opening of a new business location, service of process will still be attempted at his published address. When the owner is not available, the server will likely try to make delivery to the government of Tallahassee, Florida. That’s right. If the registered agent is unavailable, service delivered to Tallahassee may be deemed properly delivered.
If the claim was filed in federal court, the company will have 21 calendar days to file an answer or responsive pleading. The 21 days are calendar days, and they start counting down on the date the notice was delivered–even if it was delivered to Tallahassee. As unfair as it may sound, the clock does not start counting down when the registered agent actually receives the notice.
So in federal court, if the owner returns home and actually receives the notice 14 days after it was delivered to Tallahassee, the company will only have 7 calendar days (including weekends) to file an answer or a responsive pleading. Remember, an owner cannot represent a company pro se, so the company must hire an attorney to handle the matter. So to recap, that’s 7 calendar days (5 business days) to (1) locate and hire the appropriate attorney, (2) explain the matter to him or her, and (3) file a response to the appropriate court. This may seem like a long time, but some attorneys charge more when they have to drop everything to immediately address your matter.
For a commercial eviction, a company only has 7 days to respond before a default judgment may be entered. A default judgment for a commercial eviction is very expensive. It requires a company to pay attorney’s fees, rents due for the entire duration of the contract, and possibly back rent. Even more burdensome, the owner of the company is usually personally liable for the debt. So if the company is unable to pay, the court can legally seize the owner’s personal assets.
The minimal cost of hiring a Florida attorney registered agent now, before a claim is filed against your company, far outweighs all the potential costs associated with default judgments and waiver or defenses. If filed timely, some affirmative defenses stop a law suit almost as soon as it starts. Protect your company and its assets by making the worthwhile investment in an experienced attorney as a registered agent.