Readers will know that I’m no fan of California’s Revised Uniform Limited Liability Company Act (aka CARULLCA). As originally enacted, the law was rife with technical errors. As the legislature continues to tinker with the CARULLCA, it creates even more problems for existing California LLCs. The legislature’s recent enactment of AB 1722 (Wagner) is yet another dispiriting legislative “fix” that is likely to increase, rather than
Individuals and corporations, but not limited liability companies, may be licensed as real estate brokers under the California Real Estate Law. This is a result of a bargain reached when California’s enacted its first limited liability company law – the Beverly-Killea Act. In order to overcome the objection of the California Trial Lawyers Association, the act proscribed
Section 17701.13 of the California Corporations Code requires that a limited liability company designate and continuously maintain in California both an office and an agent for service of process. The office need not be a place of the LLC’s activity in California. However, the LLC is required to maintain specified records at the designated office.
Trusts are confusing. Fundamentally, a trust describes a relationship, not a person. Thus, the California Supreme Court has described a trust as “a fiduciary relationship with respect to property in which the person holding legal title to the property — the trustee — has an equitable obligation to manage the property for the benefit of another — the
Yesterday, the SEC announced that it had filed a complaint against a securities professional alleging that he had defrauded “two institutions he solicited to invest in a shell company he controlled whose name was deceptively similar to that of a legitimate private equity fund.” (The SEC likes to say that it “charges” defendants, but it
Section 17701.04(b) of the California Corporations Code provides: A limited liability company may have any lawful purpose, regardless of whether for profit, except the banking business, the business of issuing policies of insurance and assuming insurance risks, or the trust company business. A domestic or foreign limited liability company may render services that may be
A Delaware limited liability company might reasonably expect that Section 18-305 of Title 6 of the Delaware Code governs the inspection rights of its members. However, members of a foreign LLC, including an LLC organized under Delaware law, may have inspection rights under California’s Revised Uniform Limited Liability Company Act. Section 17708.o8 of the California Corporations
There are three paths to dissolution under California’s Revised Uniform Limited Liability Company Act (RULLCA). First, an event of dissolution set forth in a written operating agreement or the articles of organization may occur. Cal. Corp. Code § 17707.01(a). Second, ninety consecutive days may pass during which the limited liability company has no members. Cal. Corp. Code § 17707.01(c).
California Labor Code Section 407 may be a bit of a surprise to many lawyers both in and outside of the state. It provides: Investments and the sale of stock or an interest in a business in connection with the securing of a position are illegal as against the public policy of the State and
Readers of this blog will know that I’ve been censorious of California’s Revised Uniform Limited Liability Company Act (CARULLCA), Corporations Code §§ 17701.01 – 17713.13. The Partnership and Limited Liability Companies Committee of the Business Law Section of the California State Bar recognized the flaws in CARULLCA and worked on a bill, AB 506 (Maienschein), to fix its multifarious problems.