Dead Men Serving
Make sure your process agents are still on the job
By Henry E. Seaton
Reprinted from etrucker.com
We are a small carrier that for years has paid an annual fee for process agents. We have been solicited by companies that offer to provide the service for a one-time fee. We have been directed to you by our current agency for an answer.
I have real concerns about resident agent services that purport to represent motor carriers forever for a one-time fee, although I must disclose that I have a financial interest in the resident agent program that referred you to me. It uses only trained motor carrier lawyers as resident agents in each state, and keeps its list of agents and their current addresses up to date with the Federal Motor Carrier Safety Administration. Agents frequently move or retire, and absent a continuing relationship between the resident agent company and the motor carrier, as well as between the company and its agents, there is no assurance that the company will remain in business or that its agents will be available in perpetuity to receive lawsuits upon you.
The resident agent requirement is serious business. Along with insurance, it is one of two filing requirements necessary to keep your authority. I am aware of numerous instances in which court papers have been served on agents and judgments have been taken against carriers that could not be set aside, either because the carrier appointed a nonlawyer agent as its representative or because the agent on which service was perfected had resigned or was dead or otherwise no longer available.
I have reviewed the list of agents of a number of the one-time fee providers. In some cases, their list of agents has not been modified in years, and I recognize the names of some now-deceased motor carrier lawyers whom they still show as serving. I believe you get what you pay for.
One final caveat is necessary. Many of the one-time-fee operations do not tell you that you should not use their list of agents for state law compliance. Appointing an agent for purposes of complying with state Secretary of State requirements is something you need to update yearly.
If you paid a fee 10 years ago and now used the list provided to you to file with the Secretaries of State where required, how many of those guys do you think are still around? Even with the annual fee, a provider’s compliance with individual state foreign corporation registration requirements is something that should be done only with special authorization and approval. Under both the federal and state systems, they will be your agents, and service on them is the same as service on you at your corporate office until they are replaced.
For the small fees involved, it makes sense to get a resident agent service that keeps an updated list of attorneys in every state that can meet the federal agent requirements and even answer your related federal transportation law questions with competence if you get sued or the need otherwise arises.