LLC

Question 1

what filing is required for an LLC?

Answer 1

certificate of organization

Question 2

what does DL consider LLCs to be?

Answer 2

creatures of contract

Question 3

along with the filing of a certificate of organization, what else must an LLC have?

Answer 3

an operating agreement

Question 4

how is an LLC managed?

Answer 4

member managed (as opposed to manager managed)

Question 5

On the topic of an LLC: when can a court pierce the veil?

Answer 5

when there is fraud or when the corporation is in fact a mere instrumentality or alter ego of its owner

Question 6

Does DL describe the fiduciary duties for an LLC?

Answer 6

no, the statute is silent

Question 7

what is the general rule on the limited liability of an LLC?

Answer 7

members are not personally liable for any obligation of the LLC

Question 8

when does an LLC not get the benefit of limited liability?

Answer 8

when the court decides it needs to pierce the veil b/c there has been (1) fraud, (2) the corporation is in fact a mere instrumentality or alter ego of its owner

Question 9

what does Aurgia Capital v. Gatz tell us about LLC?

Answer 9

that despite fiduciary duties not being mentioned in the party’s agreement, the court will read the agreement under the light of fiduciary duties (i.e. fiduciary duties of good faith and fair dealing are read into each contract)