AGLO 1973 No. 65 - Jun 15 1973
OFFICES AND OFFICERS ‑- STATE ‑- SECRETARY OF STATE ‑- CORPORATIONS ‑- NOTIFICATION TO APPOINT REGISTERED AGENTS
Nonprofit corporations which were notified of the need to appoint a registered agent as required by RCW 24.03.915 and which did not do so within ninety days of the effective date of chapter 163, Laws of 1969, Ex. Sess., thereby have ceased to exist; however, those corporations which were not so notified because of the secretary of state's lack of a sufficient mailing address are not now to be deemed to have ceased to exist as provided for in RCW 24.03.915.
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June 15, 1973
Honorable A. Ludlow Kramer
Secretary of State
Olympia, Washington 98504
Cite as: AGLO 1973 No. 65
This is written in response to your recent letter requesting an opinion of this office with respect to the current legal status of a number of nonprofit corporations that failed to appoint registered agents within the time specified in RCW 24.03.915. We respond to this question in the manner set forth in our analysis.
Chapter 24.03 RCW codifies the Washington Nonprofit Corporations Act of 1967, chapter 235, Laws of 1967, as amended. In addition to being applicable to all new nonprofit corporations organized thereunder, this act applies, as well, to
". . .
"(2) All not for profit corporations heretofore organized under any act hereby repealed, for a purpose or purposes for which a corporation might be organized under this chapter; . . ." See, RCW 24.03.010 (2).
The statute referred to in your letter, RCW 24.03.915, codifies § 98 of this 1967 act as amended by § 8, chapter 163, Laws of 1969, Ex. Sess., and provides as follows:
"The secretary of state shall notify all existing nonprofit corporations thirty days prior to the effective date of this chapter, that in the event they fail to appoint a registered agent as provided in this 1969 amendatory act within ninety days following the effective date of this 1969 amendatory act, they shall thereupon cease to exist.
[[Orig. Op. Page 2]]
"Corporations so dissolved by operation of law may be reinstated as provided elsewhere in this 1969 amendatory act."
The effective date of "this 1969 amendatory act" was August 11, 1969, in accordance with Wash. Const., Article II, § 1 (Amendment 46). The requirement referenced therein with respect to the appointment of a registered agent is covered by § 1, chapter 163, Laws of 1969, Ex. Sess., now codified as RCW 24.03.050, which provides that:
"Each corporation shall have and continuously maintain in this state:
"(1) A registered office which may be, but need not be, the same as its principal office.
"(2) A registered agent, which agent may be either an individual resident in this state whose business office is identical with such registered office, or a domestic corporation, whether for profit or not for profit, or a foreign corporation, whether for profit or not for profit, authorized to transact business or conduct affairs in this state, having an office identical with such registered office. The registered agent and registered office shall be designated by duly adopted resolution of the board of directors; and a verified statement of such designation, executed by the president or a vice president of the corporation, together with a copy of the board of directors' designating resolution certified as true by the secretary of the corporation, shall be filed with the secretary of state."
In your letter you have described the factual situation giving rise to your request and set forth your specific questions as follows:
"Of late, this office has been receiving numerous requests for continuance of reinstatement rights for those nonprofit corporations that 'ceased to exist' on November 24, 1969 for failure to comply with RCW 24.03.915. The basis for these requests being that the notices of the filing requirements were not received.
[[Orig. Op. Page 3]]
"The initial designation of agent forms, with filing requirements detailed on the reverse side of the forms, were mailed on July 24, 1969 to the corporate addresses of record. The mailing date on the forms was incorrect ‑ showing as July 24, 1970. This error was pointed out in a separate memo enclosed with the forms. The memo also carried additional information about the required filing of annual reports, due at a later date.
"Of the approximately 30,000 forms mailed, in the area of 10,000 were returned by the post office bearing notations such as 'insufficient address', 'adressee unknown', etc. In a further attempt to publicize the necessity for filing the designation of an agent, this office contacted the state Bar Association and the press and requested their assistance in this matter. A meeting was then held on November 11, 1969 to determine the advisability of a second mailing. At that time it was decided that such a mailing would be fruitless since the first forms were returned. It was also noted at that time that the corporations so dissolved would have reinstatement rights for a three year period. On November 24, 1972 those reinstatement rights expired.
"The receipt of a memorandum from assistant attorney general Wayne Williams coupled with the numerous other inquiries and requests, however, indicates the need for a formal opinion regarding the dissolution of those corporations for failure to designate registered agents. Were sufficient efforts made at notification? Are the dissolutions valid as of the date appearing on our records?"
In responding to these questions we first note the technicality that in order for the subject notifications to have been given in strict conformity with RCW 24.03.915 they should have been transmitted on or before July 11, 1969, because of the directive that they be given "thirty days prior to the effective date of this chapter." We do not, however, regard your reported delay of eleven days in mailing the notices as itself rendering them legally defective in the case of any then existing nonprofit corporations by which the notices were apparently actually [[Orig. Op. Page 4]] received ‑ evidenced by the fact that they were not returned to you by the post office. Those corporations that were thus actually notified of their need to appoint a registered agent by virtue of your July 24, 1969, mailing still had ample time to do so before the statutory ninety day deadline, particularly in view of your reported administrative extension of that deadline until November 24, 1969, in order to cover the problem arising from your eleven day delay in mailing the notices. Accordingly, it is our opinion that any of those nonprofit corporations actually receiving these notices which failed to thus respond should be deemed to have "ceased to exist" as of November 24, 1969 ‑ subject only to their three‑year right to reinstatement under RCW 24.03.302.1/
[[Orig. Op. Page 5]]
This leaves us, then, with the approximately 10,000 pre‑August 11, 1969, nonprofit corporations whose RCW 24.03.915 notices were not received but, instead, were returned to you by the post office because of "insufficient addresses" or "addressee unknown." We would most certainly prefer to be able to advise you that all of those corporations also "ceased to exist" as of November 24, 1969 (in the absence of their appointment of a registered agent by that time), for that result would obviously accord with the apparent objective of the subject statute to clear the record of all inactive or nonoperative nonprofit corporations. However, we cannot in good conscience do so.
In most fundamental terms the statute here in question required the secretary of state to notify all existing nonprofit corporations of their need to appoint a registered agent within the time specified in order to remain in good standing and, as indicated by numerous court decisions cited in 28A Words and Phrases, pp. 568-569, the word "notify" in a statute imports that notice shall actually be received by the party to be notified. See, e.g., Cameron v. Shuttleworth, 75 Ariz. 61, 251 P.2d 659 (1952); Fast v. Scruggs, 164 Okla. 196, 23 P.2d 383 (1933) (distinguishing between the word "notify" and the phrase "service notice"); and Liberty Mutual Ins. Co., Petitioner, 298 Mass. 75, 9 N.E.2d 718 (1937). Therefore, it must be said to follow that as to any corporations not receiving the notices mailed by your office on July 24, 1969, the provisions of RCW 24.03.915 did not then nor at any time thereafter begin to operate.
Of course it will readily be seen that any of those corporations which have not yet appointed a registered agent are currently subject to termination under the provisions of RCW 24.03.302, quoted in footnote 1, above, upon your mailing of a further notice to them to this effect as called for in that statute. Alternatively, if this approach does not appear feasible to you at this time because of your apparent lack of a sufficient mailing address with which to reach these corporations, we will be happy to explore the possibility of drafting a constitutionally defensible amendatory bill for submission to the next session of the legislature under which the requisite notices might be given in some other manner. In the meantime, however, our answer to this aspect of your question must be that nonprofit corporations in existence on August 11, 1969, which did not receive notification from your office as to the appointment of a [[Orig. Op. Page 6]] registered agent under RCW 24.03.915, supra, may not now be said to have ceased to exist by operation of that statute.
We trust the foregoing will be of assistance to you.
Very truly yours,
PHILIP H. AUSTIN
Deputy Attorney General
*** FOOTNOTES ***
1/RCW 24.03.302 provides that:
"When a corporation:
"(1) Has failed to file its annual report within the time required by this 1969 amendatory act; or
"(2) Has failed for ninety days to appoint or maintain a registered agent in this state; or
"(3) Has failed for ninety days, after change of its registered agent, to file in the office of the secretary of state a statement of such change; the secretary of state shall notify the corporation by first class mail that it shall cease to exist if it does not perform the required act within thirty days. If the corporation fails to perform within thirty days following receipt of the letter, it shall automatically cease to exist.
"A corporation which has ceased to exist by operation of this section may be reinstated within a period of three years following its dissolution by operation of law if it shall file its annual report or if it shall appoint or maintain a registered agent, or if it shall file with the secretary of state a required statement of change of registered agent and in addition, if it shall pay a reinstatement fee of five dollars plus any other fees that may be due and owing the secretary of state. When a corporation has ceased to exist by operation of this section, remedies available to or against it shall survive in the manner provided in RCW 24.03.300 and the directors of the corporation shall hold the title to the property of the corporation as trustees for the benefit of its creditors and members."