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(Code 1981, §14-2-402, enacted by Ga. L. 1988, p. 1070, § 1; Ga. L. 1989, p. 946, § 13; Ga. L. 1990, p. 257, § 4; Ga. L. 2003, p. 883, § 2.)
- Reservation of corporate name by financial institutions, § 7-1-131.
- Reservation of Corporate Name, Official Compilation of the Rules and Regulations of the State of Georgia, Office of Secretary of State, Commissioner of Corporations, Chapter 590-7-2.
- For article, "Comparison of Features of Old and New Business Corporation Laws Relating to Domestic Corporations," see 5 Ga. St. B. J. 13 (1968).
Source: Model Act, § 4.02. This replaces former § 14-2-41.
There are no conditions on the reservation of a corporate name, unlike former Georgia law, § 14-2-41, which provided that a corporate name could only be reserved by persons and corporations holding specified intentions. Protection against reservation of a corporate name merely to block another's use of the name is obtained from the relatively short duration of the reservation.
Both the Model Act and former Georgia law, § 14-2-41(b), provide for reservation periods of four months (120 days in the Model Act). Former Georgia law also permitted the Secretary of State to extend the period "for good cause shown." The Code shortens the reservation period to one non-renewable 60-day period, which is sufficient to permit organization of a corporation under the procedures of the Code. Elimination of any possibility of renewal relieves the Secretary of State of a discretionary function not in keeping with the office, and the possibility of extortionate reservation of names for any significant period.
The Code eliminates the provisions of § 14-2-41(c) that permit a person acquiring the right to use the name of a domestic or qualified foreign corporation to reserve the right for five years. This Georgia provision was taken from prior North Carolina law and was intended to cover the situation in Rome Machine & Foundry Co. v. Davis Foundry & Mach. Works, 135 Ga. 17, 68 S.E. 800 (1910).
Note to 1989 Amendment The 1989 amendments changed subsection (a) to eliminate the requirement of "delivering an application to the Secretary of State for filing." Modern practice permits telephonic name reservations, and it is anticipated that computerized name reservations will soon be feasible. No fee will be charged for a name reservation under § 14-2-122. While the current practice of the Secretary of State is to send a written confirmation of a name reservation, entry in the Secretary of State's computer is prima facie evidence of a proper name reservation.
Further amendments to subsection (a) deleted the modifier "exclusive" before "use" in the first sentence. Subsection (b) was amended to delete the initial reference to "The owner of a reserved corporate name" and to replace it with "A person who has in effect a name reservation under subsection (a) of this Code section . . . ." These amendments conform the Code's language to similar language in the Limited Partnership Code.
Note to 1990 Amendment The 1990 amendment extends the non-renewable name reservation period for corporations from 60 to 90 days.
Cross-References Availability of names, see § 14-2-401. Consent to use corporate name, see § 14-2-401. "Deliver" includes mail, see § 14-2-140. Effective time and date of filing, see § 14-2-123. Filing fees, see § 14-2-122. Filing requirements, see § 14-2-120. Foreign corporations, see Article 15. "Person" defined, see § 14-2-140.
- In light of the similarity of the statutory provisions, decisions under former Code Section 14-2-41 which was repealed by Ga. L. 1988, p. 1070, § 1, effective July 1, 1989, are included in the annotations for this Code section.
- A corporation is allowed to reserve a name before actual incorporation. However, this reservation does not always confer an exclusive right to the use of the name in trade or business or even for corporate purposes. Elite Personnel, Inc. v. Elite Personnel Servs., Inc., 259 Ga. 192, 378 S.E.2d 117 (1989), overruled in part on other grounds, Future Professionals v. Darby, 266 Ga. 690, 470 S.E.2d 644 (1996) (decided under former § 14-2-41).
- 18A Am. Jur. 2d, Corporations, §§ 228.
- Right to enjoin use of name of defunct corporation, 27 A.L.R. 1024.
Protection of business or trading corporation against use of same or similar name by another corporation, 66 A.L.R. 948.
Use of "family name" by corporation as unfair competition, 72 A.L.R.3d 8.
No results found for Georgia Code 14-2-402.