FILED

U.S. COURT OF APPEALS

ELEVENTH CIRCUIT

 FEBRUARY 25, 2011

JOHN LEY

CLERK

[DO NOT PUBLISH]

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

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No. 10-14134

Non-Argument Calendar

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D.C. Docket No. 1:09-cv-01160-RLV

AZALEA HOUSE LLC,

Plaintiff-Appellant,

versus

NATIONAL REGISTERED AGENTS, INC.,

a.k.a. NRAI Services, Inc.,

Defendant-Appellee.

________________________

Appeal from the United States District Court

for the Northern District of Georgia

________________________

(February 25, 2011)

Before HULL, MARTIN and COX, Circuit Judges.

PER CURIAM:

Azalea House LLC hired National Registered Agents, Inc. (“NRAI”) as its

registered agent for receiving service of process. When Azalea House did not receive
service of process in a state-court action and later suffered a default judgment, itsued

NRAI in federal court for negligence, alleging that NRAI did not properly serve it

with process. The district court granted summary judgment in favor of NRAI, finding

that Azalea House’s failure to receive process and the subsequent default judgment

were caused, not by NRAI’s actions, but by Azalea House’s failure to notify NRAI

that it had moved its office from Atlanta, Georgia to Ormond Beach, Florida. After

review, we affirm.

We review a district court’s summary judgment decision de novo, applying the

same legal standards as those that governed the district court. Capone v. Aetna Life

Ins. Co., 592 F.3d 1189, 1194 (11th Cir. 2010) (citation omitted). Summary judgment

is appropriate where “there is no genuine dispute as to any material fact and the

movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). We construe

the facts and draw all reasonable inferences in favor of the non-moving party. Abel

v. S. Shuttle Servs., Inc., 620 F.3d 1272, 1273 n.1 (11th Cir. 2010) (citation omitted). 

We therefore state the facts in the light most favorable to Azalea House, the

non-moving party.

Azalea House was organized as a Georgia limited liability company in

December 2005, and at that time designated NRAI as its registered agent for service

of process. A five-member LLC, Azalea House designated Martin Schueren as an

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officer and the managing agent. In the Articles of Organization filed with the Georgia

Secretary of State, Azalea House listed the following address as its mailing address

and principal place of business: 825 Highland Lane, #1215, Atlanta, Georgia 30306. 

This address was actually Schueren’s home address at the time, and was the only

contact address provided to NRAI for its use as registered agent. 

In March 2006, one of Azalea House’s members, Mark Pinzur, transferred

property located on Azalea Drive in Augusta, Georgia to Azalea House by quitclaim

deed. The property was located less than one mile away from the Augusta National

Golf Club, where the Masters Golf Tournament is played annually. As its sole asset,

the property was intended to be used as a hospitality house during the Masters Golf

Tournament. 

In May 2007, Martin Schueren and the registered office of Azalea House

moved from Atlanta, Georgia to Ormond Beach, Florida. When Azalea House

retained NRAI as its registered agent, Schueren received a notice regarding the

importance of notifying NRAI of any change of address for Azalea House. That

notice provided a toll-free telephone number for change-of-address purposes. Despite

this notice, Schueren did not notify NRAI of the change of address. Schueren also

failed to notify the Georgia Secretary of State’s office when he and the company

moved. Due to the failure to inform the Secretary of State’s office, Azalea House did

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not receive its annual corporate renewal forms, did not pay its annual fee, and was

later administratively dissolved.

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About seven months after Azalea House moved its registered office without

telling anyone, in December 2007, NRAI was served with process for an action that

had been filed against Azalea House in a Georgia state court. Pursuant to its internal

policies, NRAI attempted to call Azalea House about the filing of the lawsuit. That

effort proved unsuccessful because the provided number was a wrong number. The

next day, NRAI forwarded the process, via overnight Federal Express delivery, to the

only address that it had on file for Azalea House: the Highland Lane address in

Atlanta, Georgia. 

The package sent to the Georgia address was never returned to NRAI, and

NRAI received a delivery confirmation from Federal Express. The delivery

confirmation indicated that signature confirmation could be obtained by calling

Federal Express. NRAI did not call to verify that a signature had been obtained,

however, because it assumed the package was received based on the delivery

confirmation. It is undisputed that Federal Express did not obtain a signature when

it delivered service of process. 

 Azalea House was eventually reinstated, and then filed this lawsuit. 1

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Azalea House did not actually receive service of process of the state-court

action, and did not file an answer. A default judgment was entered. Like the service

of process, Azalea House claims to have never received a copy of the default

judgment. NRAI sent the default judgment via Federal Express to the same Georgia

address provided by Azalea House. On this occasion, however, NRAI received

notification that Azalea House was no longer present at that address, and the package

was returned to NRAI as undeliverable. NRAI then sent the default judgment by the

United States Postal Service to the Georgia address. While the record is unclear as to

what happened to this package, Azalea House contends it never received a copy of

the default judgment. 

As a result of the default judgment entered against Azalea House, ownership

of its sole property reverted to one of its individual members, Mark Pinzur. The

property was subsequently sold at a sheriff’s sale to a third party based upon a

judgment that had been entered in another case against Pinzur. Azalea House did not

learn that ownership of the property had been transferred until May 2008. Azalea

House then filed this action, seeking damages for the value of the Azalea Drive

property, lost profits, and punitive damages.

In this diversity case, Azalea House has sued NRAI for negligence. Under

Georgia law, to state a cause of action for negligence, a plaintiff must establish the

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following essential elements: “(1) a legal duty; (2) a breach of this duty; (3) an

injury; and (4) a causal connection between the breach and the injury.” Dozier Crane

& Mach., Inc. v. Gibson, 644 S.E.2d 333, 336 (Ga. Ct. App. 2007). The district court,

in granting summary judgment in NRAI’s favor, implicitly assumed that NRAI

breached its legal duty to Azalea House but concluded that Azalea House could not

establish a causal connection between this breach and the default judgment entered

against Azalea House. We may affirmthe district court’s grant ofsummary judgment

on any ground, regardless of whether the ground was addressed and relied upon by

the district court. Cuddeback v. Fla. Bd. of Educ., 381 F.3d 1230, 1235 (11th Cir.

2004). 

A. Duty

Georgia law does not provide, either by statute orjudicial decision, any specific

duty of care that a registered agent owes to a limited liability company. Under

O.C.G.A. § 14-2-504, a registered agent must receive service of process on behalf of

the company, but the statute does not require an agent to perform any particular acts

in receiving service of process. Because Georgia law is silent on the duty that a

registered agent owes to an LLC, the parties agree, as do we, that a registered agent

simply owes a duty of “reasonable care” in receiving service of process. 

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Azalea House contends that NRAI breached its duty to use reasonable care

because it did not follow its own delivery policy. Azalea House’s theory isthat NRAI

was negligent in failing to obtain a signature upon delivery. The failure to obtain a

signature, in turn, caused NRAI to commit a number of other allegedly negligent

acts–namely, that NRAI failed to send Azalea House an email, conduct a Google

search, send the service of process by United States mail, and contact the Post Office

for forwarding information. To establish NRAI’s legal duty to obtain a signature and

perform all of these acts, Azalea House cites NRAI’s “Registered Agent Services

Manual,” which says: “The overriding responsibility as [registered] agent is to

[receive] legal processes on behalf of your client and to take all steps necessary to

communicate with and forward to the client the legal process immediately upon

receipt.” (R.2-36, Ex. D at 5.) In addition to the Manual, Azalea House points out

that the Executive Vice President of NRAI testified in his deposition that NRAI, as

a matter of company policy, requires a signature for delivery of service of process. 

(R.2-36, Ex. A at 9.) The Vice President also testified that, if a package is returned,

NRAI takes multiple steps in order to find a more accurate address. NRAI will call

the phone number on record, perform internet research in an attempt to find a better

address, or send the package by United States mail in hopes that there will be a

forwarding address or that it will be returned with a better address. (R.2-36, Ex. A

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at 15-16.) Based on this evidence, Azalea House argues that there is a genuine issue

of material fact as to whether NRAI breached its legal duty to use reasonable care in

receiving service of process. 

We conclude that, as a matter of law, NRAI did not breach its duty of

reasonable care to Azalea House. First, we emphasize that no agreement between

Azalea House and NRAI addresses what performance will be required of NRAI as

registered agent. Most notably, NRAI never represented to Azalea House that a

signature would be required or that NRAI had a responsibility to obtain a signature. 

Second, the Vice President’s testimony and NRAI’s Manual do not establish any legal

duty to obtain a signature upon delivery of service of process. “Standards or

recommendations published by a private entity for use as guidelines do not create a

legal requirement to comply with those standards, and violation of such privately set

guidelines, although admissible as illustrative of negligence, does not establish

negligence.” Muller v. English, 472 S.E.2d 448, 454 (Ga. Ct. App. 1996) (internal

quotation marks and citation omitted). Whatever NRAI’s policies may provide, they

do not create any legal duty on NRAI’s behalf. And, while NRAI’s violation of its

own policy may be admissible evidence of negligence, that evidence, in the context

of this case, does not create a genuine issue of fact for trial. No reasonable juror

could conclude that NRAI, with no agreement whatsoever as to its performance, was

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negligent by failing to obtain a signature, send an email, or perform a Google search,

especially considering NRAI sent the process to the only address that Azalea House

provided and received delivery confirmation that process was delivered. We

therefore affirm the district court’s grant of summary judgment on the ground that

NRAI did not breach its legal duty to Azalea House. 

B. Causation

Even if NRAI’s failure to comply with its internal policies could establish a

breach of its legal duty to Azalea House, the district court was correct in granting

summary judgment on the ground that NRAI’s negligence did not cause the default

judgment entered against Azalea House. The district court found that the default

judgment entered against Azalea House was caused by Azalea House’s failure to

notify NRAI of its change of address, not any act or omission of NRAI. 

Azalea House contends this was error, arguing that it most likely would have

received the service of process had NRAI made sure that Federal Express obtained

a signature. Azalea House bases its theory of causation on the following chain of

events: First, if NRAI had required a signature when it sent the service of process,

and no signature was obtained, the package would have been returned to NRAI.

Second, if the package had been returned to NRAI, it would have then sent the

package via the United States Postal Service to the same address. Third, if the

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package was sent by the United States Postal Service, it would have been forwarded,

either by the Postal Service itself or the occupants of Schueren’s Georgia address, to

Schueren’s correct address in Florida. Fourth, if the package was sent to Schueren’s

Florida address, Schueren would have received it, and made sure the complaint was

answered in order to avoid a default judgment. 

We agree with the district court that, as a matter of law, NRAI’s conduct was

not the cause-in-fact or proximate cause of Azalea House’s harm in suffering a

default judgment. To show causation, “a plaintiff must introduce evidence which

affords a reasonable basis for the conclusion that it is more likely than not that the

conduct of the defendant was a cause in fact of the result. A mere possibility of such

causation is not enough.” Gay v. Redland Baptist Church, 653 S.E.2d 779, 780 (Ga.

Ct. App. 2007) (quotations and citation omitted). 

Azalea House’s string of speculative contingencies cannot establish an

unbroken chain of events that amounts to cause-in-fact or proximate cause under

Georgia law; the causal chain breaks in multiple places. First, it is unclear that the

package would have been returned to NRAI if a signature was required. Even if

NRAI required a signature, Federal Express may not have actually obtained one, or

may not have obtained one from Schueren. No cited evidence in the record

establishes Federal Express’s policy regarding signatures–who must sign, when they

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must sign, the consequences of signing, etc. Second, assuming that requiring a

signature would have caused the package to be returned to NRAI, it is unclear that

NRAI would have turned around and sent the same package via United States mail

to the same Georgia address, or somehow found Schueren’s Florida address on the

internet. Third, assuming NRAI would have sent the package by United States mail

to the same Georgia address, there is no evidence that the package would have been

forwarded to Schueren’s correct address in Florida. The undisputed evidence shows

that Schueren was not receiving all of his mail through the forwarding service with

the United States Postal Service. In particular, the Secretary of State’s office sent

Schueren an invoice for Azalea House’s annual fee, but that invoice was not

forwarded, which eventually led to Azalea House’s administrative dissolution. And,

NRAI used the United States Postal Service to forward the default judgment to

Azalea House, but Azalea House allegedly never received that package. Fourth and

finally, assuming the package somehow made it to Schueren in Florida, it is unclear

that he would have made arrangements to answer the complaint against Azalea

House. Considering Schueren did not change Azalea House’s address, did not pay

its annual fee, did not communicate with any other Azalea House members, and

allowed Azalea House to administratively dissolve, it is speculative to conclude that

he would have made arrangements to answer the complaint. Based on this string of

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contingencies, we conclude, as the district court did, that Azalea House has not

created any genuine issue of material fact as to whether NRAI’s negligence caused

Azalea House to suffer a default judgment. 

AFFIRMED. 

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