Relations Of Members And Managers To Persons Dealing With Limited Liability Company

  1. Law
  2. Illinois Compiled Statutes
  3. BUSINESS ORGANIZATIONS
  4. Limited Liability Company Act.
  5. Relations Of Members And Managers To Persons Dealing With Limited Liability Company

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(805 ILCS 180/Art. 13 heading)

Article 13. Relations of members and managers to
persons dealing with limited liability company

 

(805 ILCS 180/13-5)

Sec. 13-5. No agency power of a member as member.

(a) A member is not an agent of a limited liability company solely by reason of being a member.

(b) Nothing herein shall be deemed to limit the effect of law other than this Act, including the law of agency.

(c) A person's status as a member does not prevent or restrict law other than this Act from imposing liability on a limited liability company because of the person's conduct.

(Source: P.A. 99-637, eff. 7-1-17.)

 

(805 ILCS 180/13-10)

Sec. 13-10. Limited liability company liable for member or manager's actionable conduct. A limited liability company is liable for loss or injury caused to a person, or for a penalty incurred, as a result of a wrongful act or omission, or other actionable conduct, of a member or manager acting in the ordinary course of business of the company or with authority of the company.

(Source: P.A. 90-424, eff. 1-1-98.)

 

(805 ILCS 180/13-15)

Sec. 13-15. Statement of authority.

(a) A limited liability company may deliver to the Secretary of State for filing a statement of authority. The statement shall be executed and filed in accordance with Section 5-45 of this Act and:

  • (1) must include the name of the company and the address of its principal place of business; and
  • (2) may state the authority, or limitations on the authority, of any member or manager of the company or any other person to:
    • (A) execute an instrument transferring real property held in the name of the company; or
    • (B) enter into other transactions on behalf of, or otherwise act for or bind, the company.

(b) To amend or cancel a statement of authority, a limited liability company must deliver to the Secretary of State for filing a statement of amendment or cancellation. The statement shall be executed and filed in accordance with Section 5-45 of this Act and must include:

  • (1) the name of the limited liability company and the address of its principal place of business;
  • (2) the date the statement of authority being amended or cancelled became effective; and
  • (3) the contents of the amendment or a declaration that the statement of authority is canceled.

(c) Except as otherwise provided in subsections (e) and (f), a limitation on the authority of a member or manager of the limited liability company contained in a statement of authority is not by itself evidence of knowledge or notice of the limitation by any person.

(d) A grant of authority not pertaining to transfers of real property and contained in a statement of authority is conclusive in favor of a person that is not a member and that gives value in reliance on the grant, except to the extent that when the person gives value, the person has knowledge to the contrary.

(e) A certified copy of a statement of authority that grants authority to transfer real property held in the name of the limited liability company and that is recorded in the office for recording transfers of the real property is conclusive in favor of a person that is not a member and that gives value in reliance on the grant without knowledge to the contrary.

(f) If a certified copy of a statement of authority containing a limitation on the authority to transfer real property held in the name of a limited liability company is recorded in the office for recording transfers of that real property, all persons that are not members are deemed to know of the limitation.

(g) Unless previously cancelled by a statement of cancellation, a statement of authority expires as of the date, if any, specified in the statement of authority.

(h) If the articles of organization state the authority or limitations on the authority of any person on behalf of a company, the authority stated or limited shall not bind any person who is not a member or manager until that person receives actual notice in a record from the company that agency authority is stated or limited in the articles. If the authority stated or limited in the articles of organization conflicts with authority stated or limited in a statement of authority filed with the Secretary of State under this Section on behalf of the company, the statement of authority is the effective statement and a person who is not a member or manager may rely upon the terms of the filed statement of authority notwithstanding conflicting terms in the articles of organization.

(Source: P.A. 101-553, eff. 1-1-20.)

 

(805 ILCS 180/13-20)

Sec. 13-20. Statement of denial. A person named in a filed statement of authority granting that person authority may deliver to the Secretary of State for filing a statement of denial that:

  • (1) provides the name of the limited liability company and the caption of the statement of authority to which the statement of denial pertains; and
  • (2) denies the grant of authority.

An effective statement of denial operates as a restrictive amendment under subsection (b) of Section 13-15 and, if a certified copy thereof is recorded in the office for recording transfers of real property in which a prior statement of authority has been recorded as provided in subsection (e) of Section 13-15, the statement of denial shall be deemed a limitation on the statement of authority for purposes of subsection (f) of Section 13-15.

(Source: P.A. 99-637, eff. 7-1-17.)


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