Can I sue a corporation not in good standing?

[marbol]

What is the name of your state? TX

I have sent a demand letter to a corporation demanding 400 dollars. I noticed when I looked up their address for service, that the Texas State Comptrollers department shows them as not in good standing for not being up to date on their taxes.

Does this mean they are not a valid corporation and I can't sue them?

What if they just don't answer the court?

So far they haven't answered the letter or done anything. So will I have problem filing a lawsuit against them? Will I be able to enforce any judgement if I win?

Thanks

 

[dcatz]

Let’s work backwards.

Will I be able to enforce any judgement if I win?

Probably not. If they’re not operating at all, almost certainly not.

So will I have problem filing a lawsuit against them?

You shouldn’t have a problem filing it with the Court. You may have a problem serving them.

What if they just don't answer the court?

Assuming that you can get them served, you’ll get to take a default judgment.

Does this mean they are not a valid corporation and I can't sue them?

They’re valid; they just lack authority to conduct business. You can sue them. Depending on the laws of your jurisdiction, they may lack authority to use the court system to defend, if they are operating and care to try to defend. Again, depending on the laws of your jurisdiction, if they are operating in a suspended status, you may be able to sue the president as conducting business as a sole proprietorship. You should consult with local counsel about that and, for $400, you probably could not justify the expense.

Before going further, why not check to see that they’re still doing business?

 

[marbol]

[...]
They’re valid; they just lack authority to conduct business. You can sue them. Depending on the laws of your jurisdiction, they may lack authority to use the court system to defend, if they are operating and care to try to defend. Again, depending on the laws of your jurisdiction, if they are operating in a suspended status, you may be able to sue the president as conducting business as a sole proprietorship. You should consult with local counsel about that and, for $400, you probably could not justify the expense.

Before going further, why not check to see that they’re still doing business?

They're doing business alright. They're posting billboards all over the city trying to get new business. They are a bank. They are opening new branches all the time. They are taking money all the time - and operate ATM machines and have tellers, etc.

The secretary of state of Texas lists them as not being caught up with their taxes.

So. It's interesting that you mention I could possibly sue the President. It might be fun just to do that. Especially since it doesn't cost much to sue in small claims court here.

Thanks.

 

[dcatz]

I said:
you may be able to sue the president as conducting business as a sole proprietorship. You should consult with local counsel about that

You could in CA. You could have yourself on the wrong side of a counter-suit in TX.

An now that you've added more information, you might want to check on how current the SoS's information is.

More commonly, a suspended corporation is a corporation on the way to being defunct. You're describing something that sounds anything but that. Especially in the case of a bank, where the possibility of that happening could trigger a run by depositors.

If they're suspended of record when and if you sue, you designate them that way, but they also could be in god standing by the time the case is heard.

 

[marbol]

I said:
you may be able to sue the president as conducting business as a sole proprietorship. You should consult with local counsel about that

You could in CA. You could have yourself on the wrong side of a counter-suit in TX.

I understand. Of course, I truly wonder what they could possibly demand in a counter-suit.

An now that you've added more information, you might want to check on how current the SoS's information is.

As of 2 days ago. The letter had the seal of the SoS on it and was dated Sept 17th. I will wait the ten days and then re-query the SoS.

More commonly, a suspended corporation is a corporation on the way to being defunct. You're describing something that sounds anything but that. Especially in the case of a bank, where the possibility of that happening could trigger a run by depositors.

Precisely. That worried me. One would think it would worry them more.

If they're suspended of record when and if you sue, you designate them that way, but they also could be in god standing by the time the case is heard.

Ok, so I should designate them as being suspended in the suit. But I kind of wonder if that will help me. At any rate, I suppose the judge should know it.

Thanks

 

[dcatz]

I don't know whether it will help you, but you should designate them as they exist at the time of filing regardless.

Besides, designating the defendant as ACME, INC., a suspended corporation, doesn't alter the legal entity that you're suing, ACME, INC. "a suspended corporation" is a "descriptive". It may or may not change. It may or may not have bearing on how you can enforce a judgment, but it won't hurt you and won't affect the the identity or composition of the prospective judgment debtor - ACME, INC.

 

[marbol]

Let’s work backwards.
[...]

Thank you SO much for your help. They have refunded my money to me within a day of getting my letter.

They did ask me for a call back, and as soon as I can get to a phone that works, I'll give them a call.

Thanks -

And for anyone reading these messages out there - go ahead and fight if you feel your right. You do win sometimes.

 

[dcatz]

Congratulations to solving the problem with just a letter.

We never knew what the claim was about, but I am glad you didn't have to go to court.

"Suspended" or not, it's secondary. Going to court is the pain.