Corporate entities buying and selling real estate is nothing new, but a dissolved entity trying to buy and sell real estate requires some expertise to keep your deal on track. . The following are some important points to bear in mind when it comes to dissolved entities:
I. There are 2 types of corporate dissolutions:
- Voluntary – Most common. Actual filing of articles of dissolution or, more likely, administratively dissolved by the state because the principal(s) stop operating, filing annual reports and paying fees.
- Involuntary – Very infrequent. Consult Underwriting to review court pleadings and agreements.
II. Dissolved entities cannot continue to conduct all normal business operations; they are typically limited to settling debts, selling or distributing their assets and otherwise winding up their affairs.
III. Business entities are authorized by the following statutes to continue after dissolution for the purpose of winding up their affairs, including the conveyance of real property and receipt of sale proceeds. Therefore, the required documents to review are the same as those of an active entity. If your entity was dissolved prior to the date shown in the chart below:
| TYPE OF ENTITY | GOVERNING STATUTE | EFFECTIVE DATE |
| CORPORATION | 607.1405 | JULY 1, 1990 |
| LIMITED LIABILITY COMPANY | 605.0709 | JANUARY 1, 2015 |
| LIMITED PARTNERSHIP | 620.1803 | JANUARY 1, 2007 |
| GENERAL PARTNERSHIP | 620.8803 | JANUARY 1, 1998 |
IV: Other things to consider:
- The deed should state that the conveyance is part of winding up the dissolved entity’s affairs.
- Taking on new debt and giving a mortgage are not consistent with winding up an entity’s affairs. Consult Underwriting if you are being asked to insure a mortgage from a dissolved business.
- Dissolved Non-Florida Entity – In order to determine who has authorization to convey, review the laws of the state or country where the entity was formed. Obtain a copy of any shareholder, operating or partnership agreement, which addresses who has the authority to convey in the event of dissolution. In certain circumstances, it may be necessary to obtain and record a Resolution.
- Investigate, obtain and review the dissolved entity’s documentation in order to gather appropriate signatures as early as possible.