Service of process through the Texas Secretary
of State:
(now codified by the Texas Business Organizations Code, see below)
A little-known procedure regarding service of process made upon the Secretary
of State has surfaced. To insure all process servers are immediately apprised of
this information, we provide the following:
Texas Business Corporation Act, Art. 2.11(B) begins:
“Whenever a corporation shall fail to appoint or maintain a registered agent in
this State, or whenever its registered agent cannot with reasonable diligence be
found at the registered office, then the Secretary of State shall be an agent of
such corporation upon which any such process, notice, or demand may be
served.”
The part that has been overlooked is the last sentence of this article, which
states:
“Any service so had on the Secretary of State shall be returnable in not less
than thirty (30) days.”
What this means is that the officer’s return may not be filed with the issuing
court until the expiration of thirty (30) days. If the return is filed within thirty
days of the date of service, no default judgment may be taken. Note the
following decision in Applied Health Care Nursing Div., Inc. v. Laboratory Corp.
of America; 138 S.W. 3d 627.
“Article 2.11(B) specifically states that ‘(a)ny service so had on the Secretary of
State shall be returnable in not less than thirty (30) days." Under this
unambiguous language of the statute, any return of service made before the
expiration of thirty days would not be in compliance with rules governing
service on a corporation through the Secretary of State. The return of service is
not a trivial or formulaic document. See Primate Constr., 884 S.W.2d at 152. It is
the filing of the return providing service that allows a default judgment to be
taken.
“In this case, the record shows LabCorp served the Secretary of State on
February 18, 2003. The return of service was filed in the trial court on March 7,
2003. Because LabCorp filed the return of service less than thirty days after
serving the Secretary of State, it did not strictly comply with the requirements of
article 2.11, and the default judgment must fail.”
Process servers take note. Do not file your officer’s returns on papers served
upon corporations (and other filing entities, i.e. LP's, LLP's, LLC's, etc.) through
the Secretary of State until AFTER thirty days from the date of service.
Information on the Texas Business Organizations Code:
The Texas Business Organizations Code (BOC) will replace the Texas
Corporations Act on January 1, 2010 for most filing entities. The BOC codifies
the following statutes:
* Texas Business Corporation Act
* Texas Non-Profit Corporation Act
* Texas Professional Corporation Act
* Texas Professional Association Act
* Texas Miscellaneous Corporation Laws Act
* Texas Revised Partnership Act
* Texas Revised Limited Partnership Act
* Texas Limited Liability Company Act
* Texas Real Estate Investment Trust Act
* Texas Cooperative Association Act
* Texas Uniform Unincorporated Nonprofit Association Act
The BOC was enacted in 2003 to be effective on January 1, 2006. The BOC
applies to all new Texas corporations, partnerships, limited liability companies
and other domestic filing entities formed on and after that date. In addition, it
applies to all foreign filing entities registering to transact business in Texas on
or after that date. With the exception of the filing fee provisions, the BOC does
not immediately and automatically apply to domestic entities that were created
prior to January 1, 2006, or foreign entities that registered to transact business in
this state prior to January 1st. Existing domestic and foreign entities will
automatically become subject to the BOC on January 1, 2010, unless those
entities elect early adoption of the BOC by filing an early adoption statement
with the secretary of state.
For our purposes as process servers, the BOC makes the same requirement.
The Texas Business Organizations Code, Chapter 5, Subchapter F
§ 5.251. FAILURE TO DESIGNATE REGISTERED AGENT. The secretary of state is
an agent of an entity for purposes of service of process, notice, or demand on
the entity if:
(1) the entity is a filing entity or a foreign filing entity and:
(A) the entity fails to appoint or does not maintain a registered agent
in this state; or
(B) the registered agent of the entity cannot with reasonable diligence
be found at the registered office of the entity; or
(2) the entity is a foreign filing entity and:
(A) the entity's registration to do business under this code is revoked;
or
(B) the entity transacts business in this state without being registered
as required by Chapter 9.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
§ 5.252. SERVICE ON SECRETARY OF STATE. (a) Service on the secretary of
state under Section 5.251 is effected by:
(1) delivering to the secretary duplicate copies of the process, notice, or
demand; and
(2) accompanying the copies with any fee required by law, including this
code or the Government Code, for:
(A) maintenance by the secretary of a record of the service; and
(B) forwarding by the secretary of the process, notice, or demand.
(b) Notice on the secretary of state under Subsection (a) is returnable in not less
than 30 days.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
More information can be found on the State's official website at:
http://www.sos.state.tx.us/corp/boc.shtml
IMPORTANT NOTE: WHETHER PURSUANT TO THE CORP. ACT OR THE
ORGANIZATIONS CODE, THIS APPLIES ONLY TO CORPORATIONS BEING
SERVED ON THE SECRETARY OF STATE (SOS) BECAUSE OF A FAILURE TO
MAINTAIN A REGISTERED AGENT OR BECAUSE THE REGISTERED AGENT
COULD NOT BE SERVED WITH REASONABLE DILIGENCE. IT DOES NOT APPLY
TO FOREIGN (OUT OF STATE) CORPORATIONS BEING SERVED ON THE SOS
PURSUANT TO LONG ARM STATUTES AND IT DOES NOT APPLY TO PROCESS
SERVED ON THE SOS AS AN ACTUAL DEFENDANT. (End)
HOME
of State:
(now codified by the Texas Business Organizations Code, see below)
A little-known procedure regarding service of process made upon the Secretary
of State has surfaced. To insure all process servers are immediately apprised of
this information, we provide the following:
Texas Business Corporation Act, Art. 2.11(B) begins:
“Whenever a corporation shall fail to appoint or maintain a registered agent in
this State, or whenever its registered agent cannot with reasonable diligence be
found at the registered office, then the Secretary of State shall be an agent of
such corporation upon which any such process, notice, or demand may be
served.”
The part that has been overlooked is the last sentence of this article, which
states:
“Any service so had on the Secretary of State shall be returnable in not less
than thirty (30) days.”
What this means is that the officer’s return may not be filed with the issuing
court until the expiration of thirty (30) days. If the return is filed within thirty
days of the date of service, no default judgment may be taken. Note the
following decision in Applied Health Care Nursing Div., Inc. v. Laboratory Corp.
of America; 138 S.W. 3d 627.
“Article 2.11(B) specifically states that ‘(a)ny service so had on the Secretary of
State shall be returnable in not less than thirty (30) days." Under this
unambiguous language of the statute, any return of service made before the
expiration of thirty days would not be in compliance with rules governing
service on a corporation through the Secretary of State. The return of service is
not a trivial or formulaic document. See Primate Constr., 884 S.W.2d at 152. It is
the filing of the return providing service that allows a default judgment to be
taken.
“In this case, the record shows LabCorp served the Secretary of State on
February 18, 2003. The return of service was filed in the trial court on March 7,
2003. Because LabCorp filed the return of service less than thirty days after
serving the Secretary of State, it did not strictly comply with the requirements of
article 2.11, and the default judgment must fail.”
Process servers take note. Do not file your officer’s returns on papers served
upon corporations (and other filing entities, i.e. LP's, LLP's, LLC's, etc.) through
the Secretary of State until AFTER thirty days from the date of service.
Information on the Texas Business Organizations Code:
The Texas Business Organizations Code (BOC) will replace the Texas
Corporations Act on January 1, 2010 for most filing entities. The BOC codifies
the following statutes:
* Texas Business Corporation Act
* Texas Non-Profit Corporation Act
* Texas Professional Corporation Act
* Texas Professional Association Act
* Texas Miscellaneous Corporation Laws Act
* Texas Revised Partnership Act
* Texas Revised Limited Partnership Act
* Texas Limited Liability Company Act
* Texas Real Estate Investment Trust Act
* Texas Cooperative Association Act
* Texas Uniform Unincorporated Nonprofit Association Act
The BOC was enacted in 2003 to be effective on January 1, 2006. The BOC
applies to all new Texas corporations, partnerships, limited liability companies
and other domestic filing entities formed on and after that date. In addition, it
applies to all foreign filing entities registering to transact business in Texas on
or after that date. With the exception of the filing fee provisions, the BOC does
not immediately and automatically apply to domestic entities that were created
prior to January 1, 2006, or foreign entities that registered to transact business in
this state prior to January 1st. Existing domestic and foreign entities will
automatically become subject to the BOC on January 1, 2010, unless those
entities elect early adoption of the BOC by filing an early adoption statement
with the secretary of state.
For our purposes as process servers, the BOC makes the same requirement.
The Texas Business Organizations Code, Chapter 5, Subchapter F
§ 5.251. FAILURE TO DESIGNATE REGISTERED AGENT. The secretary of state is
an agent of an entity for purposes of service of process, notice, or demand on
the entity if:
(1) the entity is a filing entity or a foreign filing entity and:
(A) the entity fails to appoint or does not maintain a registered agent
in this state; or
(B) the registered agent of the entity cannot with reasonable diligence
be found at the registered office of the entity; or
(2) the entity is a foreign filing entity and:
(A) the entity's registration to do business under this code is revoked;
or
(B) the entity transacts business in this state without being registered
as required by Chapter 9.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
§ 5.252. SERVICE ON SECRETARY OF STATE. (a) Service on the secretary of
state under Section 5.251 is effected by:
(1) delivering to the secretary duplicate copies of the process, notice, or
demand; and
(2) accompanying the copies with any fee required by law, including this
code or the Government Code, for:
(A) maintenance by the secretary of a record of the service; and
(B) forwarding by the secretary of the process, notice, or demand.
(b) Notice on the secretary of state under Subsection (a) is returnable in not less
than 30 days.
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006.
More information can be found on the State's official website at:
http://www.sos.state.tx.us/corp/boc.shtml
IMPORTANT NOTE: WHETHER PURSUANT TO THE CORP. ACT OR THE
ORGANIZATIONS CODE, THIS APPLIES ONLY TO CORPORATIONS BEING
SERVED ON THE SECRETARY OF STATE (SOS) BECAUSE OF A FAILURE TO
MAINTAIN A REGISTERED AGENT OR BECAUSE THE REGISTERED AGENT
COULD NOT BE SERVED WITH REASONABLE DILIGENCE. IT DOES NOT APPLY
TO FOREIGN (OUT OF STATE) CORPORATIONS BEING SERVED ON THE SOS
PURSUANT TO LONG ARM STATUTES AND IT DOES NOT APPLY TO PROCESS
SERVED ON THE SOS AS AN ACTUAL DEFENDANT. (End)
HOME
Service on Corporations and Other
Business Entities
Business Entities
WHO TO SERVE:
Effective September 1, 2011, Section 5.201, Business Organizations Code, is amended by
adding Subsection (d) to read as follows:
(d) A registered agent that is an organization must have an employee available at the
registered office during normal business hours to receive service of process, notice, or
demand. Any employee of the organization may receive service at the registered office.
See also Texas Business Organizations Code, Ch. 5.255
Sec. 5.255. AGENT FOR SERVICE OF PROCESS, NOTICE, OR DEMAND AS MATTER OF
LAW. For the purpose of service of process, notice, or demand:
(1) the president and each vice president of a domestic or foreign corporation is an agent of
that corporation;
(2) each general partner of a domestic or foreign limited partnership and each partner of a
domestic or foreign general partnership is an agent of that partnership;
(3) each manager of a manager-managed domestic or foreign limited liability company and
each member of a member-managed domestic or foreign limited liability company is an agent
of that limited liability company;
(4) each person who is a governing person of a domestic or foreign entity, other than an
entity listed in Subdivisions (1)-(3), is an agent of that entity; and
(5) each member of a committee of a nonprofit corporation authorized to perform the chief
executive function of the corporation is an agent of that corporation.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
NOTE: Process for service on a corporation or other business entity should indicate who to
serve. If it does not, or if it indicates a specific person for service, you should check with the
attorney client before any deviation. Always rely on the advice of the attorney client for all
issues relating to the service of process.
Effective September 1, 2011, Section 5.201, Business Organizations Code, is amended by
adding Subsection (d) to read as follows:
(d) A registered agent that is an organization must have an employee available at the
registered office during normal business hours to receive service of process, notice, or
demand. Any employee of the organization may receive service at the registered office.
See also Texas Business Organizations Code, Ch. 5.255
Sec. 5.255. AGENT FOR SERVICE OF PROCESS, NOTICE, OR DEMAND AS MATTER OF
LAW. For the purpose of service of process, notice, or demand:
(1) the president and each vice president of a domestic or foreign corporation is an agent of
that corporation;
(2) each general partner of a domestic or foreign limited partnership and each partner of a
domestic or foreign general partnership is an agent of that partnership;
(3) each manager of a manager-managed domestic or foreign limited liability company and
each member of a member-managed domestic or foreign limited liability company is an agent
of that limited liability company;
(4) each person who is a governing person of a domestic or foreign entity, other than an
entity listed in Subdivisions (1)-(3), is an agent of that entity; and
(5) each member of a committee of a nonprofit corporation authorized to perform the chief
executive function of the corporation is an agent of that corporation.
Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.
NOTE: Process for service on a corporation or other business entity should indicate who to
serve. If it does not, or if it indicates a specific person for service, you should check with the
attorney client before any deviation. Always rely on the advice of the attorney client for all
issues relating to the service of process.