CA-RULLCA Receives Corrections Two Years Later

In RULLCA Brings New LLC Laws to California in 2014 , I explained how California’s version of the Revised Uniform Limited Liability Company Act (“RULLCA” or “CA-RULLCA” – Corporations Code Sections 17701.01 – 17713.13 ) was to take effect January 1, 2014. This post describes changes to CA-RULLCA that took effect on January 1, 2016.

Most of the changes were minor clean-up of the sort that one expects when major new legislation is adopted. However, some of the changes are noteworthy.

Significant CA-RULLCA Changes

Section 17704.04(e) – If the operating agreement does not specify how profits and losses will be allocated, then they will be allocated in proportion to the value of the members’ respective capital contributions.

Section 17704.08(d) – Provides for mandatory indemnification of the limited liability company’s agents if certain criteria are satisfied.

Section 17713.04(b) and (c) – Pre-2014 acts, transactions, operating agreements, contracts, and votes and actions of members and managers are governed by California’s prior LLC law (Beverly-Killea) – even though that law no longer is in effect – rather than CA-RULLCA.

Photo credit: Thomson Reuters

Dana H. Shultz, Attorney at Law +1 510-547-0545 dana [at] danashultz [dot] com
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