One of the biggest challenges in serving offshore defendant companies is ensuring that they’re properly named (see Always Name Your Defendant Entity Correctly). Closely connected to that issue is the defendant’s address– simply put, if you don’t know where they are, I can’t get them served for you. Both of these ideas are equally applicable to cases involving U.S. defendants, so this shouldn’t be an earth-shattering thought. I suggested some time ago that, when executing a contract with an offshore party, a few things must at least be contemplated (see Five Essential Things…). Chief among them is my advice to DESIGNATE AN AGENT FOR SERVICE IN THE UNITED STATES. Do that, and you never have to retain somebody like me.
It’s not difficult– you can’t throw a rock in downtown Dover, Delaware without hitting a corporate agent. A whole bunch of outfits are happy to accept service on a company’s behalf for a low annual fee. But if that isn’t in the cards– ie: the offshore party refuses– at the very least, make sure the foreign entity actually exists before you hand them seventeen million dollars.
Look, if you’re a mortgage officer, and a young, nice-looking couple walk into your office so they can buy that $130,000 two-bedroom starter home, in addition to pay stubs and tax returns, you’re going to insist on a copy of their driver’s licenses to make sure they are who they say they are.
But a great number of my clients need to serve breach of contract complaints on offshore companies that the plaintiff never verified. Now, to be sure, many of those litigants never ran their contract by a lawyer before signing… they trusted the other party, and only sought counsel when the deal soured.
But some of those contracts were drafted by lawyers who simply didn’t undertake due diligence. Above all, lawyers…
INSIST THAT OFFSHORE COMPANIES PROVE THEIR EXISTENCE. ALWAYS.
Even if you KNOW them.
How? The same way the mortgage officer insists on her borrowers’ ID’s.
When a foreign* company shows up to sign a contract, insist that they provide a Certificate of Incorporation or comparable document. Essentially, you’re demanding to see the company’s birth certificate– and you’re going to use that birth certificate to go further in your verification. Here in Missouri (and just about everywhere else), the Certificate indicates that the company was born on such & such a date and was, at one time anyway, a real thing. It’s not that difficult to exercise due diligence and check the SoS website to verify that, yes, InBev International, Inc. is still an active entity or that– uh oh– Anheuser-Busch Beverage Group, Inc. is not. [Wait– Budweiser doesn’t exist anymore?!]
Overseas, corporate registries do pretty much the same thing. We can easily discern that British Airways PLC is an active, registered company in England, its current incarnation incorporated in 1983. We know that its registered address is Waterside, PO BOX 365, Harmondsworth, UB7 0GB. Handy information to have. And when I say to my solicitor, “hey, Nigel, could you send your process server out to tag these guys?’ he doesn’t bat an eyelash.**
But if the contract was formed in the absence of this knowledge, it could make service impossible. In short… we’ve gotta find them first, and if we can’t, the case probably goes away.
* Foreign is a term of art. It means “from outside the jurisdiction” in two senses: (1) in the “across the state line” sense and in the (2) “you need a passport to go there” sense.
** His name is not really Nigel.