LIABILITY FOR IMPROPER DISTRIBUTIONS.

  1. Law
  2. Idaho Code
  3. CORPORATIONS
  4. LIMITED LIABILITY COMPANIES
  5. RELATIONS OF MEMBERS TO EACH OTHER AND TO LIMITED LIABILITY COMPANY
  6. LIABILITY FOR IMPROPER DISTRIBUTIONS.

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30-25-406. LIABILITY FOR IMPROPER DISTRIBUTIONS. (a) Except as otherwise provided in subsection (b) of this section, if a member of a member-managed limited liability company or manager of a manager-managed limited liability company consents to a distribution made in violation of section 30-25-405, Idaho Code, and in consenting to the distribution fails to comply with section 30-25-409, Idaho Code, the member or manager is personally liable to the company for the amount of the distribution which exceeds the amount that could have been distributed without the violation of section 30-25-405, Idaho Code.

(b) To the extent the operating agreement of a member-managed limited liability company expressly relieves a member of the authority and responsibility to consent to distributions and imposes that authority and responsibility on one (1) or more other members, the liability stated in subsection (a) of this section applies to the other members and not the member that the operating agreement relieves of the authority and responsibility.

(c) A person that receives a distribution knowing that the distribution violated section 30-25-405, Idaho Code, is personally liable to the limited liability company, but only to the extent that the distribution received by the person exceeded the amount that could have been properly paid under section 30-25-405, Idaho Code.

(d) A person against which an action is commenced because the person is liable under subsection (a) of this section may:

(1) Implead any other person that is liable under subsection (a) of this section and seek to enforce a right of contribution from the person; and

(2) Implead any person that received a distribution in violation of subsection (c) of this section and seek to enforce a right of contribution from the person in the amount the person received in violation of subsection (c) of this section.

(e) An action under this section is barred unless commenced not later than two (2) years after the distribution.

History:

[30-25-406, added 2015, ch. 243, sec. 46, p. 882.]


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