Stop Wasting Money on Corporate Seals
How many corporate seals are sitting at the bottom of drawers or inside dusty corporate minute books? I extensively looked into corporate seals and want to give you permission never to order a corporate seal again! In fact, you can probably toss all of those seals at the bottom of your drawer.
Corporate seals are a relic of law and completely unnecessary for any legal or practical purpose. Yet all of the online incorporation service mills distinguish their gold, platinum and adamantium packages by providing a corporate seal, among other things.
Historically, documents were authenticated by the use of a seal due to widespread illiteracy. Traditionally, a seal consisted of a piece of wax, a wafer, or some other substance affixed to the document. Modern corporate seals — like the kind provided with nearly every corporate minute book sold today — are stamps that emboss the corporate name and state and date of formation on a document.
State corporation statutes continue to authorize corporations to adopt and use corporate seals. But do you really need one for your company? In California and New York, the answer is clearly “no.”
California law states that “the failure to affix a seal does not affect the validity of any instrument.”[ Elsewhere, the California Civil Code is even more direct in declaring that “[a]ll distinctions between sealed and unsealed instruments are abolished.” If that was not enough, the California Code of Civil Procedure also states, in a provision first enacted in 1872, that “[t]here shall be no difference hereafter, in this State, between sealed and unsealed writings.”
The same is true in New York. New York has explicitly declared that “the presence or absence of a seal upon a written instrument . . . shall be without legal effect.”
So the next time you are forming a corporation for a client, you can skip the seal with absolute confidence. If you ever have a bizarre situation that requires a seal, you can order one and have it in the bottom of your drawer within about 72 hours.
Read more about corporate seals by clicking here.