A statutory agent is the appointed party of a business responsible for receiving legal notices, (through traditional service of process or other forms of due process). Here is what can happen when a corporation fails to register their statutory agent with the State.

First of all, there are corporate penalties for not designating and maintaining a statutory agent. Corporate entities are required to appoint a statutory agent at initial filing. This party must sign off in agreement that they will maintain the position, have a physical address within the state of incorporation and be available during normal business hours.

In the event, that the statutory agent fails to be available during business hours, moves out of state without notice or even passes on, it is the corporation's duty to obtain and register another one immediately. Each state has different laws guiding the allowable time-frame a business has before penalties arise if their next appointee is not chosen and filed.

Failure to adhere has serious consequences. The business entity will be delinquent and will be notified as such via certified mail from the State. This of course, will be delivered to the company's principal address. This could pose for some embarrassment, so keep that in mind as this delinquency must be corrected.

The notice will indicate the time allotted to fix the issue at hand. If it is not, the State will proceed with dissolution of the corporation. The notice of dissolution will be sent out and a hearing will be scheduled. That's right, not properly maintaining a statutory agent could result in closure of your business.

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