The LLC Flashcards
Conversion From Another Entity
A general or limited partnership that has been converted to an LLC shall be deemed for all purposes the same entity that existed before the conversion.
Operating Agreements
The policy of the act is to give maximum effect to the freedom of contract principle. The intent of the statute is to enforce LLC agreements. These agreements are very flexible and can easily trump statutes.
Entity Status
The owner of the LLC has an interest in the specific LLC property only to hold and use the property for LLC purposes. The owner does not have the right to sell the LLC’s property. The LLC must sell it itself.
If there is only one owner of an LLC, then an argument can be made that the LLC is in fact wholly subject to that person’s control and you could pierce the corporate veil
Tort Liability (Generally)
No member or manager of a limited liability company shall be obligated personally for any such debt, obligation, or liability of the limited liability company solely by reason of being a member or acting as a manager of the limited liability company.
Tort Liability (Official or Individual Capacity)
An LLC member is still liable if they commit a fraudulent or tortious act beyond being a member of the LLC. Usually, it is difficult to distinguish whether members were acting in their individual capacity or in their official capacity.
