LLCs Flashcards
1
Q
Formation
A
- articles of organization must be filed to create an LLC
- since LLCs are a relatively new form of business association, courts tend to analyze them in the context of corporate or partnership law.
2
Q
Duties
A
- members of an LLC have fiduciary duties
- members in a member-managed LLC are treated as agents of the LLC (with actual and apparent authority to bind the LLC in ordinary, but not extraordinary) affairs
3
Q
Dissociation
A
if a member leaves, then it leads to a dissociation of that member, but it does not lead to winding up or dissolution unless the other members unanimously agree to dissolve the LLC
4
Q
Liability
A
- generally, individual members are not liabile for losses
- But they are liable if:
1, Courts pierce the LLC veil or
2. If proper procedures for dissolution and winding up have not been followed
(creditors may enforce claims against each of the LLC members but a member’s liability may not exceed the total value of assets distributed to the member in dissolution).
