Service on uncooperative individuals often requires a motion for substituted service. For Texas-chartered business entities, the Secretary of State is an option, and in Huffman Asset Managment v. Colter the Fifth Court rejected an argument that the Secretary is required to serve process anywhere other than the designated addresses:

Under HAM and Prairie Capital’s interpretation of section 5.253, the Secretary of State would be required to ignore an entity’s filings concerning its registered agent and registered office in favor of information contained in a more recent filing that is unrelated to service of process and does not designate or change a registered agent, registered office, or their accompanying addresses. Such an interpretation ignores the overarching requirement that corporations maintain a registered agent and registered office for service of process and keep the addresses of both updated with the Secretary of State.

No. 05-22-00779-CV (Nov. 7, 2023).

“The Supreme Court of Texas recently determined that section 17.028 of the civil practice and remedies code provides the exclusive means for service of process on a financial institution. Section 17.028 requires service on the institution’s registered agent. The … court held that ‘service on the Secretary [of State] as a foreign corporate fiduciary’s “agent” under [Estates Code] Chapter 505 does not constitute service on a financial institution’s “registered agent” for purposes of section 17.028.'” Bank of New York Mellon v. FFGGP, Inc., No. 05-20-00384-CV (March 11, 2022) (mem. op.) (citations omitted) (applying U.S. Bank, N.A. v. Moss, No. 20-0517 (Tex. Feb. 25, 2022)).

In the context of service of process, and reinforcing its recent holding about the distinction between individuals and entities in Prado v. Nichols, No. 05-20-01092-CV (Feb. 25, 2022) (mem. op.), the Fifth Court rejected a judgment based on the return of service in Mesa SW Management v. BBVA USA:

“Appellee used an entity to receive the process and a natural person to serve the process; [Tex. R. Civ. P.] 105 does not allow this. Rule 105 requires one person perform both actions. Because the process was delivered to an entity but a natural person executed and returned the same, we conclude appellee failed to strictly comply with rule 105.” No. 05-20-01091-CV (Feb. 24, 2022) (mem. op.) (emphasis added).

In a restricted appeal: “[T]he face of the record shows that appellee filed suit against a Texas corporation named either Joe Prado DBA J.P. Enterprises or Joe Prado ‘JP Enterprises.’ The return of service shows that Joe Prado was served but does not indicate his capacity to receive service on behalf of the purported corporation. Moreover, no other portion of the record indicates Joe Prado’s authority to receive service on behalf of the corporation. We conclude the face of the record fails to show strict compliance with the rules governing return of service; thus, the trial court lacked jurisdiction to render a default judgment against JP Enterprises.” Prado v. Nichols, No. 05-20-01092-CV (Feb. 25, 2022) (mem. op.) (citation omitted, emphasis added).

. . . But in our service.” Cf. Julius Caesar, Act I, Scene III. The key phrases in the return of service in Pro-Fire & Sprinkler, LLC The Law Co. were as follows:

The panel majority concluded this return was defective because (1) the pleading was attached to the door without looking for someone over 16 to receive it, as required by the substituted-service order, and (2) the return was inconsistent, saying both that the pleading was attached to the door and served “in person.” A dissent saw these matters as the sort of “incidental details” that do not require reversal. No. 05-19-01490-CV (Nov. 29, 2021).

Reversing a Fifth Court opinion that had held otherwise, the Texas Supreme Court held: “A limited partnership’s agents for service of process are its general partner, Tex. Bus. Orgs. Code § 5.255(2), and its registered agent, id. § 5.201(b)(1). The evidence establishes that Miraki served only a WWLC employee described as its ‘owner,’ ‘president,’ and ‘CEO.’ Accordingly, we hold that WWLC demonstrated that it was not properly served.” WWLC v. Miraki, No. 20-0173 (June 18, 2021).

Service was inadequate to support a default judgment when: “The record before us shows the citation was addressed to ‘U.S. Bank Trust, N.A.’ However, the defendant in the action and the party against whom the default judgment was taken is ‘U.S. Bank Trust, N.A., as Trustee for LSF8 Master Participation Trust.’ There is no evidence in the record that service was had upon ‘U.S. Bank Trust, N.A., as Trustee for LSF8 Master Participation Trust.'” U.S. Bank Trust, N.A. v. AJ & Sal Enterprises, LLC, No. 05-20-00346-CV (April 30, 2021) (mem. op.).

Singh v. Gill reminds of the importance of strict compliance with Tex. R. Civ. P. 106, the substituted-service rule:

• Location. “Gill’s affidavit stated only that Gill did not know where Singh could be found. Her attorney’s affidavit recounted e-mail and telephone conversations with Singh in which he refused to provide his location. Neither affidavit, however, stated facts showing that service under rule 106(a) had been attempted. … “
• Attempts. “Moreover, the affidavits do not exhibit the diligence necessary to support substituted service. ‘A diligent search must include inquiries that someone who really wants to find the defendant would make, and diligence is measured not by the quantity of the search but by its quality.’ Here, there is no indication that Gill’s diligence included searching public data or ‘obvious inquiries’ a prudent investigator would have made,’ such as attempting service by mail to obtain a forwarding address or locating and contacting other persons who would likely have information about Singh, beyond Singh’s immediate family in India.”

No. 05-19-01146-CV (Jan. 20, 2021) (mem. op.).

Evans v. Martinez arose from a jury trial as to whether reasonable diligence had been used in serving a defendant, against whom suit had been filed on the last day of the limitations period. The jury answered “no” and the Fifth Court affirmed the resulting judgment: “Here, the return of service recites that the process server first came into possession of the citation on October 27, 2015, more than a month after limitations expired. Although Weinkauf offered some evidence regarding the delay, he did not explain why, when he knew he had filed suit on the last day of limitations and that he would shortly leave on vacation, he did not make an alternative arrangement to ensure that the effort to serve Martinez would begin in his absence. On his return, he left the citation sitting at his reception desk and checked on it only once a week even after problems arose with his arrangements for service. There is no evidence to support his testimony of the efforts he made, such as phone records, notes, emails, or testimony from support staff or process servers.” No. 05-18-01241-CV (April 20, 2020) (mem. op.)

Bad service was found, and a restricted appeal succeeded, in Plummer v. Enterra Capital when the citation described the documents served (without attachments) as:

and otherwise: “The E&P citation was to be served on Plummer as E&P’s registered agent on Ridgeview Drive in Richardson, but handwriting next to the printed address showed an address on Arapaho Road in Richardson for a different entity, Richmond Engineering, Inc. Both of the returns show service at the Arapaho Road address. The Officer’s Return on each citation showed service on November 16, 2018, but the blank following ‘by delivering to the within named’ was not filled in on either return.” No. 05-19-00255-CV (Feb. 20, 2020) (mem. op.)

Craig moved to vacate an arbitration award: “Thus, under [Tex. Civ. Prac. & Rem. Code] section 171.094, she was required to arrange for service of process on appellees upon filing the motion. Craig did not arrange for service of process until she filed her supplemental motion to vacate on September 1, 2016, more than five months after the arbitration panel entered its award. Because she did not serve notice of her motion to vacate within [FAA] Section 12’s three-month limitations period, the service was untimely and the trial court was required to dismiss her motion as untimely.” The Fifth Court declined to apply any equitable tolling doctrine, and rejected an earlier emailing of the motion as inadequate under the TAA’s procedural requirements. Craig v. Southwest Securities, No. 05-16-01378-CV (Dec. 18, 2017) (mem. op.)

In BB&T v. SWIG Partners LP, the Fifth Court reversed a limitations ruling based on allegedly inadequate efforts to serve all of the defendants, observing: “Twelve of the thirty named defendants were served within three weeks after citations were issued. All the defendants then made an appearance obviating  the need for further service of process. See Tex. R. Civ. P. 120. The longest period of time without service on a defendant before all the defendants answered was four business days. The time between the date suit was filed and the date all defendants filed their original answer was twenty-eight days. When three of the defendants were omitted from the defendants’ amended answer, BB&T moved for substitute service. In granting BB&T’s motions for substitute service, the trial court repeatedly found BB&T had diligently attempted service on each of the subject defendants.” No. 05-15-00878-CV (Dec. 13, 2017) (mem. op.)

A Mexican company disputed personal jurisdiction in Texas, but ran afoul of special appearance procedure: “A special appearance that merely challenges the method of service fails as a special appearance and constitutes a general appearance. A complaint that a defendant was not served in acccordance with the Hague Convention is a complaint regarding a curable defect in service of process. Such a complaint does not defeat a nonresident’s amenability to the court’s process and thus should not be raised via a special appearance.” Vitro Packaging de Mexico v. Dubiel, No. 05-17-00258-CV (applying Kawasaki Steel Corp. v. Middleton, 699 S.W.2d 199, 202 (Tex. 1985)) (Dec. 13, 2017) (mem. op.) (citations omitted, emphasis added)

Ms. Mandava served divorce papers on Mr. Chukkapalli in India using the Hague Convention. When Chukkapalli moved for a new trial in Texas, pointing out flaws in how he was served, Mandava countered by showing that he had actual notice of the Texas lawsuit – he had made a filing with an Indian family court that identified the Texas case and attached a document from the Texas case file. The Fifth Court agreed with him about the problems with service and held: “Although it appears Chukkapalli had actual notice of the Texas divorce proceeding, actual notice to a defendant of a pending suit, without proper [service], is not sufficient.” However: “[U]pon remand, the parties will be before the court wihout need for further citation because Chukkapalli has now become subject to the jurisdiction of the court.” Chukkapalli v. Mandava, No. 05-15-01287-CV (June 30, 2017) (mem. op.)

Deutsche Bank has won a restricted appeal to set aside a no-answer default judgment. The petition named the defendant as “DEUTSCHE BANK NATIONAL TRUST COMPANY, herein sued in its capacity as the Trustee for the Morgan Stanley ABS Capital 1 Inc., Trust 2006-NC5, Mortgage Pass Through Certificates, Series 2006-NC5.” But the clerk’s office issued a citation addressed to “Deutsche Bank National Trust Company as Trustee Company,” and that name was also used on the affidavit of service. Because the citation was addressed to the wrong party, the attempted service of process was invalid and the default judgment had to be set aside.

Deutsche Bank Nat’l Trust Co. v. Kingman Holdings, LLC, 05-14-00855-CV

A year ago, the Dallas Court of Appeals affirmed the denial of an equitable bill of review in which the defendants claimed that the plaintiff had not exercised reasonable diligence in its attempts to effect service through registered mail and personal delivery. The Texas Supreme Court has now set aside that ruling, holding that the defendants had presented some evidence that their failure to receive notice of the default judgment resulted solely from the plaintiff’s failure to certify the defendants’ last known mailing address, and not from any negligence or fault on the defendants’ own part. The record contained evidence that the plaintiff’s owner had met with the defendants’ registered agent at their current address, rather than the outdated address on file with the Secretary of State, that raised a genuine issue of material fact as to the validity of the plaintiff’s “last known mailing address” certification.

Katy Venture, Ltd. v. Cremona Bistro, LLC, No. 14-0629

In this restricted appeal, the plaintiff carried out service on the defendant, a bank with a registered agent in New York, solely though service of process upon the Texas Secretary of State.  On appeal, the Court agreed with the defendant that such service was improper because the plaintiff failed to strictly comply with CPRC 17.028, which permits service upon a financial institution by service to “the president or a branch manager at any office located in the state.”

Bank of N.Y. Mellon v. Redbud 115 Land Tr.

In this memorandum opinion, the court found insufficient the sheriff’s affidavit of service, because the affidavit merely stated that the recipient “was served.”  According to the Court, “[b]ecause the return does not state the manner of service, it does not strictly comply with [TRCP] 107, which requires the officer’s return state ‘the manner of delivery of service.'”

U.S. Bank v. Pinkerton Consulting & Investigations

The defaulting defendant in this case claimed that the plaintiff’s service through the Secretary of State was defective because the plaintiff did not establish reasonable diligence in its failed efforts to effect service via registered mail and personal delivery.  The Court of Appeals found that the plaintiff exercised reasonable diligence in both of its prior attempts to carry out service.  Regarding registered mail, the record established that the plaintiff paid the clerk and arranged to have the defendants served by certified mail, return receipt requested at the defendant’s registered address.  When the mailing was returned with the notation that it was undeliverable and could not be forwarded, the plaintiff had sufficiently exercised reasonable diligence.  Regarding personal service, the plaintiff sent a process server to defendant’s registered address, but neither plaintiff’s business nor its registered agent were there.  According to the Court, this was enough since “[t]he statute does not require efforts to find the registered agent at any place other than at the entity’s registered office.”

Katy Venture Ltd. v. Cremona Bistro Corp.

The plaintiff sued his former employer, El Paisano, for unpaid wages and unpaid overtime.  After four unsuccessful attempts by a process server to serve El Paisano at the address of its registered agent, the plaintiff served the Texas Secretary of State, who then forwarded the process to the same address via certified mail.  That attempt at service also failed, and the process was returned to the secretary of state with the notation “unclaimed.”  The plaintiff then moved for a default judgment, which the trial court granted.

El Paisano eventually learned of the default judgment and sought to have it set aside.  The trial court denied its motion for a new trial, and El Paisano appealed.  El Paisano argued, among other things, that it was not properly served because the secretary of state did not send the process to its principal place of business.  The Court of Appeals rejected that argument and upheld the default judgment, noting that the plaintiff was entitled to use substituted service on the secretary of state and that the secretary of state had no obligation to send it anywhere other than the address of El Paisano’s registered agent.

El Paisano Nw Hwy v. Arzate, No. 05-12-01457-CV

A pair of California residents sought to set aside a default judgment by means of a restricted appeal. The defendants claimed that the trial court lacked jurisdiction due to defective service of process, which had been accomplished through the Secretary of State. The Secretary of State’s certificate of service stated that process for both defendants had been “Unclaimed.” After the defendants failed to appear, the trial court entered default judgment for $612,500 in damages and another $13,258.27 in attorney fees. The Court of Appeals affirmed. Although the process server had listed the date of execution as taking place the month before he received the citation, that apparent typographical error was not enough to invalidate the return of service, particularly where the other service documents demonstrated the correct date of service. Substitute service through the Texas Secretary of State was also proper, the Court held, because the petition alleged that they were doing business in Texas by entering into a promissory note and guaranty with a Texas company, with the note also secured by real property located in Kaufman County. Nor did the “Unclaimed” notations demonstrate that the citations had not been served. Instead, the Court followed previous cases holding that it indicated only that the defendants had refused or failed to claim the citations from the Secretary of State’s mailings, not that service had not been accomplished.

Dole v. LSREF2 APEX 2, LLC, No. 05-12-01683-CV

In this memorandum opinion, the Court held that the plaintiff failed to effect service on the defendant because the proof of service on the Secretary of State’s return stated that “no such number” existed.  This, according to the Court, was prima facie evidence that the defendant was not served.

U.S. Bank N.A. v. Bonney

Big D appealed from the denial of its motion for new trial following a no-answer default judgment. The court of appeals found that the trial court properly refused to set aside the default judgment.  Big D did not prove that its failure to answer was not intentional or the result of conscious indifference but was due to a mistake or accident.  Rollins properly served Big D by substituted service on the secretary of state after seven failed attempts to serve Big D’s registered agent at the agent’s registered office and home.  The substitute service on the secretary of state was not rendered void by the process being returned with the notation “Refused” because the secretary is not an agent for serving but for receiving process on the defendant’s behalf.  Big D also failed to show that the evidence was insufficient to support the amount of damages awarded by the trial court.  The court of appeals found that the car owner’s testimony regarding the “Blue Book” value of her vehicle was not so weak that the finding of damages was clearly wrong and unjust.  Thus, the court of appeals affirmed the trial court’s judgment.

Big D Transmission v. Rollins, No. 05-11-01019

Karen Smith sued Brown Consulting & Associates, her employer, for injuries she sustained during the course of her employment.  BCA never appeared, and the trial court entered  default judgment in Smith’s favor.   On appeal, BCA argued that Smith failed to properly serve it, and that the default judgment should be voided.  The Court of Appeals agreed with BCA, finding that the affidavit Smith submitted in suport of her rule 106(b) motion for substitute service of process was defective for two reasons.  First, the affidavit did not contain a statement that BCA’s address was the usual place of business of the defendant or its registered agent.  Second, the affidavit did not contain a statement that the address is a place where the registered agent could probably be found.  Because the Court strictly construes the rules governing service when a default judgment is entered, it reversed the trial court’s entry of default judgment and remanded the case for further proceedings.

Brown Consulting v. Smith

The court affirmed a summary judgment reviving a default judgment entered against Bartz in 1989. Randall brought this action to revive it in 2010, providing affidavit evidence purportedly showing that she procured a writ of execution to be served on Bartz at his last known address in 1999, thereby extending the time to revive and enforce the judgment until 2011. The court granted Randall’s motion for summary judgment, reviving the default judgment.

On appeal, Bartz argued that Randall failed to show that her revival action was timely. The court noted that Randall had the burden to show that a writ was prepared and issued by the court clerk and delivered to the proper officer for execution within the 10-year statutory time period. The evidence showed that Randall had a writ issued just inside of 10 years after the judgment and that the judgment thus became dormant in 2009, ten years after the writ issued. Randall’s action to revive the judgment was then filed less than two years after the judgment became dormant, so the action was timely. Finally, when the writ was returned due to a bad address Bartz supplied, Randall had no obligation under the statute extending the life of the judgment to ensure actual service.

Bartz v. Randall, No. 05-11-00836-CV

Few defendants are willing to take the risk of not answering a lawsuit when service of process has been defective.  After all, moving to quash service in Texas only gets you additional time to file an answer (see TRCP 122), and there is always the chance that a default judgment will be sustained if the attack on service is unsuccessful.  But whether by  luck or design, Bailey’s Furniture, Inc. has reversed the trial court’s entry of default judgment by challenging the plaintiff’s attempted service of process.  According to the process server’s affidavit, he had attempted to serve “Defendant Charles Bailey” on five occasions.  But while the petition identified Charles Bailey as the registered agent of Bailey’s Furniture, nothing in the process server’s affidavit indicated that he was being served in that capacity, and he was not in fact the defendant named in the lawsuit.  Because proper service had not been made prior to entry of the default judgment, the trial court never obtained personal jurisdiction over Bailey’s, rendering the judgment void.  The court of appeals therefore reversed and remanded the case to the district court for further proceedings.

Bailey’s Furniture, Inc. v. Graham-Rutledge & Co., No. 05-11-00710-CV