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Subject: What the heck is a "Resident Agent"?

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JoanG
(Maryland)

Posts:17

08/21/2008 6:06 PM
I just recently became the president of an HOA for a small -- 61 home -- community. The old president gave me all her files, which turned out to be in a mess. But the worst discovery was that while we had an accountant do our corportation taxes each year, the former president hadn't filed those taxes since 2004, and consequently, we've lost our corporation status. So, the accountant tracked down the "Articles of Revival" form on the state website. The form must be signed by the "resident agent." The only name I could find associated with the title "resident agent" belongs to a woman who is a part of the company that did the land development for this community. We have had such problems with that company! Our lawyer is still trying to get them to turn the deed to some of the supposedly HOA-common area over to us. Anyway, I would like to know just what a "resident agent" is. What's their role and responsibility? Our lawyer is drawing up papers for the board to use to pass a resolution to assign resident agent status to someone else. Can we do that without the cooperation of the land developer and this woman? If this is a confusing question, it's because I am so confused!! thanks, Joan

MicheleD
(Kentucky)

Posts:1676

08/21/2008 6:14 PM
I have no idea what your state laws and guidelines are, but in Kentucky, all we have to do is change the resident agent. There is a form (that we can access online) to do that. Once that is done we can then re-submit the annual report (it's the annual report that connects us to our active status in Kentucky, not whether or not we've filed taxes), and pay any reinstatement fees. Check on that website to see if there are forms that you can fill out to change the resident agent.

SusanW1
(Michigan)

Posts:2117

08/21/2008 6:15 PM
We have always used the secretary and the legal address of the HOA as the Registered Agent and the contact address.

MicheleD
(Kentucky)

Posts:1676

08/21/2008 6:27 PM
Here's the form for Change of Registered Agent in Kentucky. It costs $5.00 to file it. The "Consent of Registered Agent" signature block is NOT for the current one to agree to transfer to a new one, but it's for the NEW Registered Agent to sign acknowledging she/he is going to be the Registered Agent. You can have your attorney's office be the registered agent if you like. It doesn't even have to be a board member. I don't know why your attorney would need to draft a Resolution to do this. Maybe to rack up some fees? ========================================================== Kentucky Secretary of State TREY GRAYSON _________________________________________________________________________ Division of Corporations BUSINESS FILINGS P.O. Box 718 Frankfort, KY 40602 (502) 564-2848 http://www.sos.ky.gov/ _________________________________________________________________________ Statement of Change of Registered Office RAC or Registered Agent or Both Pursuant to the provisions of Chapter 271B,273,275, or 362 of the Kentucky Revised Statutes, the undersigned hereby applies to change the registered office of registered agent, or both on behalf of ________________________________________________________________________ (Exact name of entity) which is organized in the state of ______________, and for that purpose submits the following statements: 1. Name of current registered agent.....2. Registered agent is hereby changed to __________________________________..........___________________________________ 3. Address of current registered office.......4. Registered office is hereby changed to _________________________________.............._________________________________ _________________________________.............._________________________________ _________________________________.............._________________________________ _________________________________.............._________________________________ The Street address of the registered office and the business office of the registered agent, as changed, will be identical. 5. Signature of officer or chairman of the board.....6. Consent of Registered Agent ....member, manager, or partner _________________________________.................I consent to serve as the registered agent Signature and title...............................on behalf of this entity _________________________________................._________________________________ ....Type or print name and title................Signature of registered agent _________________________________................._________________________________ .........e........................................Date RAC (06/07) (See attached sheet for instructions)

JoanG
(Maryland)

Posts:17

08/21/2008 6:32 PM
I just did some additional searching online re:my question, and found an answer ofn Wikipedia. http://en.wikipedia.org/wiki/Registered_agent#cite_note-1 I guess that answers my question!! The function of a registered agent "Most businesses are not individuals but instead business entities such as corporations or Limited Liability Companies (LLCs). This is because there are substantive liability protections as well as tax advantages to being "incorporated" as opposed to being "self-employed". "Most jurisdictions in the United States require that any business entity that is formed or doing business within their borders designate and maintain a "Registered Agent". This person may be known as the "Resident Agent"or "Statutory Agent", depending on the laws of the individual jurisdiction in which the business entity is registered. The purpose of a Registered Agent is to provide a legal address (not a P.O. Box) within that jurisdiction where there are persons available during normal business hours to facilitate legal service of process being served in the event of a legal action or lawsuit. Generally, the registered agent is also where the state government sends all official documents required each year for tax and legal purposes such as franchise tax notices and annual reports. It is the registered agent's job to forward these suits and notices to the entity itselfΔ]. Registered Agents generally will also notify business entities if their state government filing status is in "Good Standing" or not. The reason that these notifications are a desired function of a registered agent is that it is difficult for a business entity to keep track of legislative changes and report due dates for multiple jurisidictions given the disparate laws of different states. "Penalties for not maintaining a registered agent generally will cause a jurisdiction to revoke a business’s corporate or LLC legal status as well as in some cases, assess additional penalty fees on the entity. "If a Registered Agent fails to perform their function, it can have dire consequences for the business entity. For example, if a customer fell inside a store and sued the store, and the store's registered agent failed to notify the business entity of a summons to appear in court to respond to the lawsuit, then when the case went to trial, nobody would appear to defend the store and the customer would win by a default judgment. Additionally, the store would likely not be able to get the judgment overturned on appeal because they had been properly served. This is one of the most common reasons that business entities generally will utilize a third party as their Registered Agent be it a commercial service company, an attorney, or in some cases, a CPA. "The person at the business entity that maintains contact with the registered agent is the corporate secretary or governance officer." There's more on the website. And, I will question the lawyer about why we can't do this ourselves!

MicheleD
(Kentucky)

Posts:1676

08/21/2008 6:55 PM
I just downloaded the Change of Resident Agent form for Maryland and see why the attorney is "drafting the resolution" to authorize a change of resident agent. Here is the link to the form. http://www.dat.state.md.us/sdatweb/gov_ra.pdf But either way it's a pretty simple process and it shouldn't be a problem restoring your Corp status once all the "i"s are crossed and the "t"s dotted. . . . or the other way around!

SusanW1
(Michigan)

Posts:2117

08/21/2008 7:14 PM
I don't suggest the attorney being the Registered Agent. Too far away from the "home" base. You want all vital mail and/or official notices to get to the secretary or another officer of the corporation.

MicheleD
(Kentucky)

Posts:1676

08/21/2008 7:55 PM
That really is dependent on the HOA. We had our secretary as registered agent for ever. We aren't managed, so that registered (resident) agent changes every time our secretary changes, and it has to be her home address, instead of the PO Box. If we were managed, or had a PM company, we would probably have them assigned as registered (resident) agent. The ONLY thing we ever get is service regarding foreclosures or bankruptcies. These are items that we need to get to our attorney anyway, since he does the collections for us, so we decided to re-assign our registered agent to his office. The registered agent designation does not change the main contact / address for the HOA, but it does affect the service, either by mail or by sheriff, of the types of documents he probably needs before we do, anyway. Especially if he needs to prepare a response to keep our interests alive in a foreclosure or bankruptcy. So it really does majorly depend on how each individual HOA operates.

JoanG
(Maryland)

Posts:17

08/22/2008 3:31 AM
Michele -- you are a wonder!! Thank you so much for fiding that. I've emailed the attorney that, thank you very much, we can do this on our own. Yeah!! Joan

SusanW1
(Michigan)

Posts:2117

08/22/2008 4:48 AM
Joan - just reading over your original post. I am concerned about the responsibilies that you have placed on the previous president, including the record keeping. Do you have a secretary? That person is the keeper of the records. Do you have a Treasurer? That person files the financial reports. The minutes should reflect ALL these filings. (All IRS and state paperwork, plus any other permits, licenses, etc that are required annually) As a person who does an audit review for my HOA, I look for that in the mintutes AND in the records of the Treasurer.

GeraldT4

Posts:932

08/22/2008 5:13 AM
JoanG - Uh, oh, you used Wickipedia as a source. I'm surprised there were objections to your doing so. You must be one of the special people.

MicheleD
(Kentucky)

Posts:1676

08/22/2008 6:21 AM
You certainly are childish, aren't you. I suppose you didn't bother reading my qualifications on the issue of Wikipedia, nor do you care to. You just want to pout and moan like a baby who's had his knuckles rapped. It might be in your best interest to go back to that thread and re-read my comments. You're continued snarking on something that was never EVER a personal criticism of you is getting tiresome. Grow up.

GeraldT4

Posts:932

08/22/2008 7:53 AM
MicheleD - You have qualifications?

DwightT
(Idaho)

Posts:443

08/22/2008 7:58 AM
Didn't Donna already send you both to your corners for this? How about you both just ignore each other.

DonnaS
(Tennessee)

Posts:2796

08/22/2008 8:06 AM
Thanks Dwight, I was just about to send a reminder.

JoanG
(Maryland)

Posts:17

08/22/2008 12:18 PM
Gosh, what did I start, with my Wikipedia reference?! Believe me, I know that Wikipedia should not be considered an ultimate source of accurate information. It does appear though that this time the info was correct. And, Susan, please know that I in no way put all that responsibility on the old president -- I was the treasurer, and have all my files in order, but the previous president kept all the other records and would not delegate to the secretary. Then, as I wrote earlier, while she had told me she was filing everything in lot number-related files, I discovered stacks of unfiled stuff, and tax documents that were never mailed in. (I and the previous treasurer had been giving them to her to sign and mail.) Like so many of us HOA Board people, I came into this knowing nothing -- actually I originally joined the Board so that I could figure out what it was all about, and now find myself president. Oh well... that's what you get for volunteering! And a word in defense of lawyers: when I wrote our lawyer this morning saying we could do the forms ourselves -- for changing the Resident Agent and reviving the corporation -- he wrote back that he would try to see if the firm could serve as Resident Agent, even without making the fee for handling the forms. He wrote, " a disadvantage to board members serving as resident agents is that you may be faced with changing the resident agent again in a couple of years if the person leaves the board or the community. We usually recommend that we serve as an association’s resident agent. We do not charge for serving as resident agent for our long-term clients." Can anyone see a problem with that?? Joan

MaryA1
(Arizona)

Posts:2157

08/22/2008 12:57 PM
Joan, In some states this person is called the "statutory agent". This is the official person of contact for the assn. In most instances the agent is the board Pres or the manager. When you file your annual report each year, you should be able to change the name of the registered agent if need be.

MaryA1
(Arizona)

Posts:2157

08/22/2008 1:02 PM
Joan, You must have posted your message at the same time I was posting mine. In answer to your question; NO, I see nothing wrong with having the attorney designated as the resident agent. This is not uncommon at all. And, since he isn't charging a fee for this (which he shouldn't as it requires no work on his part!), why not? Actually it's just a formality. If the state needed to contact the assn for anything, they would contact the registered agent. For instance, if the annual reports are not being filed and there has been no response from the assn, the state will contact the registered agent.

JoanG
(Maryland)

Posts:17

08/22/2008 1:06 PM
Thanks, Mary!

SusanW1
(Michigan)

Posts:2117

08/22/2008 1:08 PM
Our lawyer got hauled off to jail and no one ever told us until someone read it in the paper. The annual report allows you to indicate changes. If there is a change then do it there. In no way would I like an outside agency to be the registered agent for our HOA.

MicheleD
(Kentucky)

Posts:1676

08/22/2008 1:56 PM
Posted By JoanG on 08/22/2008 12:18 PM Gosh, what did I start, with my Wikipedia reference?! Believe me, I know that Wikipedia should not be considered an ultimate source of accurate information. It does appear though that this time the info was correct. Joan You didn't "start" anything, Joan. Gerald has an issue with a post I made after his in another thread where I simply stated I would not rely on Wikipedia as a source. For some unknown reason, he took it as a personal affront and his nose is out of joint about it and he continues to bellyache and taunt like a child over it. Yes, Wikipedia often can have "reliable" information and I also use it, quite often, as a quick check and a starting point. I would not, however, bring it to the table if I'm trying to cite or source credible information or base a position solely on Wikipedia-sourced info. It has its weaknesses, and it never hurts to keep that in mind when "weighting" its contribution to a discussion. I'm glad, though, that the Resident Agent issue is moving along and that you guys are but a few steps away from reinstating your status.

MicheleD
(Kentucky)

Posts:1676

08/22/2008 2:01 PM
Posted By SusanW1 on 08/22/2008 1:08 PM Our lawyer got hauled off to jail and no one ever told us until someone read it in the paper. The annual report allows you to indicate changes. If there is a change then do it there. In no way would I like an outside agency to be the registered agent for our HOA. That's unfortunate, but in no way would we continue anymore with just one of us as the registered agent. A board member could just as easily be hauled off to jail for one thing or another. For our HOA, and for many others, the attorney (especially if it's the same attorney who handles all our collections) is the preferred reliable contact for "registered agent." Our HOA's Principal Office is listed as the HOA PO Box, both on the Annual Report and in the official Documents. The Registered Agent, however, can be, and is in our case, a different address. It really does depend on the needs of the HOA and the laws in the HOA's jurisdiction.

DwightT
(Idaho)

Posts:443

08/22/2008 2:07 PM
Posted By MicheleD on 08/22/2008 2:01 PM Our HOA's Principal Office is listed as the HOA PO Box, both on the Annual Report and in the official Documents. The Registered Agent, however, can be, and is in our case, a different address. It really does depend on the needs of the HOA and the laws in the HOA's jurisdiction. FWIW: In Idaho, a PO box cannot be used as the address of the Registered Agent. A physical address must be listed or the State will reject the Annual Report. The State wants to know where to serve legal papers in case the entity gets sued.

MicheleD
(Kentucky)

Posts:1676

08/22/2008 2:15 PM
Posted By DwightT on 08/22/2008 2:07 PM Posted By MicheleD on 08/22/2008 2:01 PM Our HOA's Principal Office is listed as the HOA PO Box, both on the Annual Report and in the official Documents. The Registered Agent, however, can be, and is in our case, a different address. It really does depend on the needs of the HOA and the laws in the HOA's jurisdiction. FWIW: In Idaho, a PO box cannot be used as the address of the Registered Agent. A physical address must be listed or the State will reject the Annual Report. The State wants to know where to serve legal papers in case the entity gets sued. Dwight, I did not mean the PO box for the Principal office, my apologies, I meant the street address, which is actually the street address of our common area, which only houses the HOA mailbox! Sorry for that mis-statement. In Kentucky, we cannot use PO Boxes for either Principal Office address or Registered Agent. But the Principal Office, including the address listed on the Annual Report, can be different from the Registered Agent's address, and, in many many cases in Kentucky, at least, it is any attorney or even a Property Management's office, rather than the HOA's Principal Office. Again, sorry for the confusion.

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