1.0Arizona LLC Lawhttps://www.keytlaw.com/azllclawRichard Keythttps://www.keytlaw.com/azllclaw/author/1llclawyer/rich600338<blockquote class="wp-embedded-content" data-secret="0MQW63qkeX"><a href="https://www.keytlaw.com/azllclaw/2018/05/member-duties/">Run Forrest Run: Arizona Liability Company Act Inflicts Numerous New Duties on Members</a></blockquote><iframe sandbox="allow-scripts" security="restricted" src="https://www.keytlaw.com/azllclaw/2018/05/member-duties/embed/#?secret=0MQW63qkeX" width="600" height="338" title="“Run Forrest Run: Arizona Liability Company Act Inflicts Numerous New Duties on Members” — Arizona LLC Law" data-secret="0MQW63qkeX" frameborder="0" marginwidth="0" marginheight="0" scrolling="no" class="wp-embedded-content"></iframe><script type="text/javascript"> /* <![CDATA[ */ /*! This file is auto-generated */ !function(d,l){"use strict";l.querySelector&&d.addEventListener&&"undefined"!=typeof URL&&(d.wp=d.wp||{},d.wp.receiveEmbedMessage||(d.wp.receiveEmbedMessage=function(e){var t=e.data;if((t||t.secret||t.message||t.value)&&!/[^a-zA-Z0-9]/.test(t.secret)){for(var s,r,n,a=l.querySelectorAll('iframe[data-secret="'+t.secret+'"]'),o=l.querySelectorAll('blockquote[data-secret="'+t.secret+'"]'),c=new RegExp("^https?:$","i"),i=0;i<o.length;i++)o[i].style.display="none";for(i=0;i<a.length;i++)s=a[i],e.source===s.contentWindow&&(s.removeAttribute("style"),"height"===t.message?(1e3<(r=parseInt(t.value,10))?r=1e3:~~r<200&&(r=200),s.height=r):"link"===t.message&&(r=new URL(s.getAttribute("src")),n=new URL(t.value),c.test(n.protocol))&&n.host===r.host&&l.activeElement===s&&(d.top.location.href=t.value))}},d.addEventListener("message",d.wp.receiveEmbedMessage,!1),l.addEventListener("DOMContentLoaded",function(){for(var e,t,s=l.querySelectorAll("iframe.wp-embedded-content"),r=0;r<s.length;r++)(t=(e=s[r]).getAttribute("data-secret"))||(t=Math.random().toString(36).substring(2,12),e.src+="#?secret="+t,e.setAttribute("data-secret",t)),e.contentWindow.postMessage({message:"ready",secret:t},"*")},!1)))}(window,document); //# sourceURL=https://www.keytlaw.com/azllclaw/wp-includes/js/wp-embed.min.js /* ]]> */ </script> Why LLCs Must Have an ALLCA Compliant Operating Agreement: Reason #7 Forrest Gump’s mother used to tell him “Life is like a box of chocolates. You never know what you’re gonna get.”  This statement applies to Section 29-3409 of the new Arizona Limited Liability Company Act (ALLCA) effective September 1, 2019.  Members who are subject to Section 29-3409 will NEVER know what they get under this statute until they win or lose a law suit for breach of one or more of the new duties levied on members of member managed Arizona LLCs.  This new law imposes fiduciary duties for the first time on members of all member managed Arizona LLCs. Instead of calling the ALLCA by its full legal name, I frequently refer to ALLCA as the Arizona Liability Company Act because of the many fiduciary duties the new law levies on members of member managed Arizona LLCs.  New duties means new potential liabilities imposed on members that can cause them to be named as defendants in lawsuits and to be liable for attorneys’ fees and damages. Fortunately most of the new fiduciary duties levied on members and managers of Arizona LLCs under ALLCA can be eliminated or modified by a well drafted Operating Agreement.  Members of Arizona LLCs that hire a competent Arizona LLC attorney will be able to sign an ALLCA compliant Operating Agreement.  Unfortunately it will be the unsuspecting members of member managed multi-member Arizona LLCs that lack an ALLCA compliant Operating Agreement that will be subject to the new fiduciary duties.  These new duties levied on members and mangers are a litigation attorney’s dream because they will have many new reasons to sue members of multi-member Arizona LLCs that are member managed. [...]