Recent Legislative Changes to Service of Process: A New Ball Game?

• Date: 01 May 2023
• Author: Bossa, Giacomo

In 2022, the Florida Legislature passed S.B. 1062, which reshaped the procedures for, and methods governing, service of process for actions pending in Florida courts. The legislation, which became effective in substantial part on January 2, 2023, simplifies, clarifies, and modernizes the manner of service of process on business entities. For instance, S.B. 1062 permits service of process by "other means" when traditional methods of service have been unsuccessful, including by email or other electronic means, and provide a more robust method for service of process on persons and businesses in foreign countries. The legislation also allows constructive service of process for absent mothers in paternity actions and for unknown parties-in-possession in eviction actions and revises the procedures for pre-suit notices in medical malpractice actions. All practitioners who litigate in Florida should become familiar with these legislative changes, so that they may benefit from or respond effectively to the new requirements and procedures.

S.B. 1062 stems from an initiative by the Business Law Section of The Florida Bar. In 2018 and 2019, a task force of the section was studying possible amendments to the Florida Business Corporations Act, F.S. Ch. 607. At that time, Ch. 607 and other chapters of the Florida statutes addressing the formation, governance, and operation of different types of business entities each contained comprehensive provisions detailing methods and procedures for service of process on those types of business entities. But these laws duplicated, and sometimes conflicted with, provisions in F.S. Ch. 48, the general statutory regime addressing service of process in Florida courts. These conflicts led to difficulties by practitioners and the courts in interpreting and reconciling these parallel sets of requirements. (1) The Business Law Section decided to create a separate task force to study and propose possible legislative changes to the statutes regarding service of process to address this situation.

Finding no justification for duplicative statutory regimes, the task force proposed to do away with the provisions regarding service of process on limited liability companies, for-profit and not-for-profit corporations, partnerships, limited partnerships, and limited liability partnerships under F.S. Chs. 605, 607, 617, and 620, and to consolidate these provisions within Ch. 48. The substantive provisions relating to service of process in the "entity statutes" would then be replaced by cross-references to the applicable provisions of Ch. 48. In some cases, notably relating to service of process on corporations, the task force concluded that the provisions in Ch. 607 were preferable to those in Ch. 48, so these provisions were moved to Ch. 48 and largely substituted in place of the existing statutory provisions. (2)

Additionally, through its research and deliberations, the task force concluded that in many respects the provisions of Ch. 48 were unduly complex, vague, incomplete, and antiquated. The Bar's International Law Section also approached the task force with a proposal to revise the provisions for service of process in foreign countries to follow the provisions of Fed. R. Civ. P. 4(f). Later, during the legislative process, the Real Property, Probate, and Trust Law Section, the Family Law Section, and the Florida Justice Association also proposed separate statutory provisions addressing service in paternity actions, evictions, and pre-suit proceedings involving medical malpractice that were included in the legislation.

Service of Process on Specific Types of Business Entities

The task force undertook to revise service of process on general partnerships, limited partnerships, limited liability partnerships, corporations, and limited liability companies. The main goal of the task force here was to make the procedures for service of process more, regardless of the type of business entity, and thereby simplify the procedures for benefit of all constituencies.

The members of the task force agreed that service of process on business entities should generally follow a waterfall-based approach with three layers, summarized as follows: 1) Service on the registered agent is preferred and should occur first; 2) Service on the entities' representatives should be next; and 3) As a last resort, service on the secretary of state or alternative service including through electronic means could be obtained.

The First Level--The Registered Agent

The task force wanted to foster a good culture of responsible companies and registered agents while simplifying the process and ensuring that bad players would not benefit from road-blocks and procedural traps lurking in the statutory regime. As a result, the task force settled on a basic requirement that only one good-faith attempt to serve the registered agent must be made before the party attempting service can move to the next level of the waterfall. A single good-faith attempt avoids the requirement that the party seeking to secure service of process show "due diligence" in its attempts to serve a representative higher positioned in the waterfall before moving to the next level in the hierarchy, since regardless of his or her position in the hierarchy, personal service on a responsible representative of the entity would still provide actual notice of the lawsuit consistent with due process. At the same time, the task force felt that a party seeking service of process should first attempt to serve the registered agent, where the entity has an active one, since the main responsibility of the registered agent of any entity is to accept process on its behalf and to ensure that the entity is timely and properly notified of a lawsuit.

The only exception to this new requirement that service must first be attempted on the registered agent deals with general partnerships. Under Ch. 620, a general partnership was not required to register with the Florida Department of State or to designate a "registered agent" to accept process but, under former F.S. [section]48.8105, a general partnership needed to only register with the Department of State and designate an "agent." This designated agent did not, however, have authority to accept service of process. Instead, the designated agent only had to maintain a list of the names and mailing addresses of all the partners of the partnership and, on request and good cause shown, make the list available at the partnership's office. (3) In practice, however, if a general partnership elected to have a designated agent, the secretary of state would record the designated agent...