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Legislative updates

House Bill 2109, effective September 24, 2023, provides that a corporation sole may not be reinstated on or after June 8, 2015, but that a corporation sole that exists before June 8, 2015 may continue to operate as a corporation sole, if it remains active and was not dissolved.

House Bill 2108, effective September 24, 2023, revises the procedure whereby the Secretary of State withdraws a certificate of filing or a document submitted for filing.

Senate Bill 185, effective January 1, 2022, amends provisions of the nonprofit corporation law regarding the members and board of directors discussing issues and taking action by electronic mail or other electronic means without a meeting.

Senate Bill 359, effective January 1, 2020, creates procedures whereby a corporation’s board of directors may ratify a defective corporate action. It also requires the filing of articles of validation under certain circumstances, and authorizes the circuit court to take certain actions regarding the determination of the validity of corporate actions or ratifications. A defective corporate action is defined as an action that, but for a failure of authorization, is within the corporation’s power to take and would have been within the corporation’s power to take at the time the corporation took the action; and an overissue.

Senate Bill 360, operative January 1, 2020, amends numerous provisions of the Nonprofit Corporations Act on issues including electronic transmissions and notice, shell corporations, bylaws, directors, committees, quorums, rights of members, mergers, and inspection of records.

Case summaries

Lee (House of R.E.A.P.) v. Secretary of State, 324 Ore. App. 275, decided February 15, 2023. The Oregon Court of Appeals held that an administratively dissolved corporation sole could be reinstated. Therefore it reversed the trial court’s dismissal of a petition to review the Secretary of State’s decision to deny reinstatement. An amendment to Oregon law provided that no corporation sole could be formed after 2015 but that pre-existing corporations sole could continue to operate, subject to the nonprofit corporation law. The Secretary of State interpreted the law as providing that a corporation sole that was administratively dissolved ceased operating and therefore could not be reinstated. However, the court pointed out that the corporation sole was now subject to the nonprofit corporation law, which permitted reinstatement.

Other notices

February 2022 – The Oregon Secretary of State has posted a business alert concerning a mailing it called “deceptive and confusing” that resembles the official annual report notice form, but that comes from a private company, not affiliated with the Secretary of State. The alert, which includes a copy of the annual report notice form that is being mailed by the private company, can be read in full from the Secretary of State’s website here.

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