Flashcards in Member and Manager Liability Deck (4)
What is the general rule re: member and manager liability for LLC obligations?
In general -->
Members and Managers are NOT personally liable for LLC's obligations.
Under what circumstances may court "pierce the LLC veil"?
What is the EFFECT of doing so?
Courts may pierce LLC veil to reach MEMBER'S and MANAGER's personal assets to satisfy LLC obligations under similar circumstances as corporation.
EXCEPTION --> failure to observer formalities (ie..having meetings/recording minutes) will NOT be a group for piercing LLC veil
What is the rule re: indemnification of LLC members/managers?
Members and managers are INDEMNIFIED for debts, obligations, and other liabilities incurred in the court of their activities on behalf of the LLC PROVIDED THAT -->
- the complied with DOL and DOC