Most new businesses must jump through several hoops before they can legally register in their state of operations. Business entities such as corporations and limited liability companies (LLC) are required by law to register with the California secretary of state to conduct business in the state. Part of the requirements for registration is that the business must give the name and contact information of a registered agent. Selecting a registered agent can be just as important as choosing the correct business entity for you. There are several things to consider when choosing a registered agent to act on your business’s behalf.
A registered agent serves as the main contact person for a registered company. One of the main tasks of a registered agent is to receive service of process on behalf of the corporation or LLC in case the company is subject to a lawsuit. However, the agent also receives other documents on behalf of the company, including official correspondence from the state. In some cases, the resident agent ensures the company is up to date with annual compliance paperwork.
Because the registered agent is supposed to receive all the important correspondences mentioned above, you need a registered agent who is available at all times during regular business hours. If there is no one to receive service of process at the address you give when registering your company, there could be serious consequences. If someone is suing your company, and you fail to receive notice of the lawsuit and do not show up to court, the person suing you can ask for a default judgment against you. A default judgment is an automatic ruling in favor of the party requesting the judgment, and a court can grant a default judgment without even requiring a judge to consider the merits of the case. You can petition a court to reverse the default judgment in some cases, but this is often a complicated and expensive process.
Important Considerations When Choosing a Registered Agent
Your registered agent should also be reliable and professional enough to handle and forward any correspondence sent to you or your company.
The price of hiring a registered agent varies depending on the company you choose. It is important to understand what is included with the fee for the agent you select. For example, some companies may charge a flat fee for all services, while others may charge extra for filing paperwork for annual compliance and for mail forwarding.
If fees for a registered agent are prohibitively high, a person forming a company may consider serving as his or her company’s own registered agent. If the person is sure that he or she will be available to receive service at all times during regular business hours, then it may make more sense to serve as his or her company’s agent. However, if the business is mainly virtual, or maintains offices in various states, or if the owner is often mobile, selecting a reliable registered agent is a better idea.
Choosing A People’s Choice As Your Corporation’s Registered Agent
If you are setting up a California corporation and want to avoid the high cost of attorney’s fees, contact A People’s Choice for low-cost legal document assistance. Although we cannot give legal advice, A People’s Choice can help you in preparing all the required legal documents to help you incorporation without having to hire a lawyer. We can also act as Registered Agent for your corporation or limited liability company for a low, annual fee.
If you need more information about utilizing our office as your registered agent for your California corporation, or if you are looking to incorporate in California, do not hesitate to call our office. A People’s Choice has been providing self-help legal document services for over 35 years and has established an excellent reputation in the community. If you are ready to start the incorporation process, information can be provided to us through our convenient online system, over the phone or in person.