# Entrepreneur of the Week Tomer Maor # Post 3
I chose to dedicate this post to a rather boring topic in nature. A topic related to the term that everyone who works with an LLC encounters is the Registered Agent (in order not to change the language on the keyboard every time, it is called a registered agent).
Who is that mysterious agent, what do I need him for, and why is not more than just a "mailing address". We will talk about this today (do not worry, there will also be an example story and at the end the morality of the mind, but later).
Let's start at the beginning.
Anyone who works with an LLC encounters this term - Registered Agent (or other names, depending on the State). Some of you have started companies on your own, through all kinds of services, some of you have been assisted by an accountant or a lawyer, and some of you may have started a company at all through someone who helped you and marketed the property you purchased. In almost every state one of the details needed to open a company is a registered agent.
You did everything right, always: you worked carefully, you transferred money only through the Teitel company (and not just because you read about Danny in the previous post), you checked every step of the way. Registered agent? Have you noticed who it is? Did you give it any importance?
So first of all, what is a registered agent anyway? By and large - this is a person or company, whose job is to receive legal documents (Service of Process) on behalf of the company. That is: lawsuits, court summonses, and in some states also notices and notices regarding tax payments, company registration, etc. What all these documents have in common is that they are very important documents, and usually have a date of delivery.
Now something important: delivery to a registered agent is delivery to a company. That is, on the day your registered agent received a letter regarding your company, in terms of law, you received that letter.
So imagine for example that you decided to use your friend's uncle's address as a registered agent. And the nice uncle flew for a walk, leaving his kids at home. The children received letters, did not open. One of the letters? Statement of Claim. What to do after a lawsuit? File a letter of defense of course. But how will you know if you have not been notified?
The plaintiff will come and ask for a verdict against you (and also accept, because there was a lawful invention).
But leave, why go to hypothetical situations. I promised a story? Time to keep promises. Of course the names of the parties (and places) were changed for reasons of confidentiality.
A very nice guy named Rahamim approached me (by the way, Roy also referred to me). My father bought a property a few years ago in a picturesque town called Townsville, ST. Mercy had a lot of issues with the property. He was unable to rent it out (i.e. his management company was unable to do so), did not receive a lease on it, and in fact the property was a burden on mercy and he did not want it at all. Therefore, Rahamim decided to sell the property to Roi.
Rahamim and Roi talk about price, look, examine. Roy checks on Zillow. Calling for Mercy. "mercy. According to Zillow, your property was sold a good few months ago. "
Mercy was surprised. Roy too. It can not be, after all, but never sold his property.
What Rahamim and Roi did not know, is that in Townsville, ST, (as in many other places in the US) if you do not pay local taxes, it may lead to your house being auctioned off (because the essence of this post is not the procedure of this sale , We will not go into detail on this point. But the idea is clear: you owe money, they will take your house, simply).
But still, we are in the US and not in some banana republic. There is no way they can take your property and sell it to third parties without at least informing you of an intention to do so and allowing you to deal and defend (Do you know the Fifth Amendment? Or rather, do you know the Fourteenth Amendment which refers to the states and not the federal government? Familiar? So by and large, no state is allowed to deprive a person of property without a fair trial).
You're starting to understand where it's rolling and how it communicates?
In any case, let's continue: Rahamim bought his home at the time from a company that markets properties to investors in the United States for a guaranteed return. dream! The same company pampers its investors to such an extent that it also opens LLCs for them and also - serves as registered agents for them! Stunning! Save $ 100 a year!
The same company also did not so much tell Mercy when he purchased the property, that there is some small debt that needs to be paid off (really small). The same company, which also served as the management company, had to take care of the tax payments. But alas: the company did not do that. The existing debt remains, another debt has been added, and the guys in Townsville, ST decide to act.
step one? Warning letter. Send to Rahamim's company address. The letter is received by the…? of course! Registered Agent. Pity in the dark, he has no idea. A foreclosure, a legal proceeding, an auction, a winner, an auction initiated by the winner of the auction that prevents the previous owner of the property from getting his property back is already announced. All of these proceedings (according to court documents) were lawfully invented. whom? To a registered agent. And pity? Mercy did not know. He did not know! (Admittedly at first I did not think of the name Mercy as the fictitious name, but it was quite requested).
Morality of mind and bottom lines:
If it's important for you to get legal information in a timely manner, do not underestimate this function of Registered Agent. It is highly recommended that you do not rely on the person marketing your property to open an LLC for you, and if you have already done so, make sure you have control over who your registered agent is. And if the company that sold you and set up your company has already registered itself as your registered agent, do not save that $ 100 a year. Hire a reputable registered agent and replace it.
In the pictures: Townsville, ST (Just the truth, these are pictures taken from one of my favorite places to look out over Boston and Cambridge - Boston University Bridge. A few minutes walk from home and a nice place to stand and clear your head a bit. On the right Boston, on the left Arles in two different aggregation states). One photo from the winter (taken by a friend), one photo from the fall (which I took). Can you identify which of the photos in the winter? 😁