PART III. 
RELATIONS OF MEMBERS AND MANAGERS TO PERSONS



DEALING
WITH THE LIMITED LIABILITY COMPANY



 



[§428-301]  Agency of members and managers. 
(a)  Subject to the provisions of subsections (b) and (c):



(1)  Each member is an agent of the limited liability
company for the purpose of its business;



(2)  An act of a member, including the signing of an
instrument in the company name, for apparently carrying on in the ordinary
course the company's business or business of the kind carried on by the company
binds the company, unless the member had no authority to act for the company in
the particular matter and the person with whom the member was dealing knew or
had notice that the member lacked authority; and



(3)  An act of a member which is not apparently for carrying on
in the ordinary course of the company's business or business of the kind
carried on by the company binds the company only if the act was authorized by
the other members.



(b)  Subject to subsection (c), in a
manager-managed limited liability company:



(1)  A member is not an agent of the company for the
purpose of its business solely by reason of being a member;



(2)  Each manager is an agent of the company for the
purpose of its business;



(3)  An act of a manager, including the signing of an
instrument in the company name, for apparently carrying on in the ordinary
course the company's business or business of the kind carried on by the company
binds the company, unless the manager had no authority to act for the company
in the particular matter and the person with whom the manager was dealing knew
or had notice that the manager lacked authority; and



(4)  An act of a manager which is not apparently for
carrying on in the ordinary course the company's business or business of the
kind carried on by the company binds the company only if the act was authorized
under section 428-404(b)(2).



(c)  Unless the articles of organization limit
their authority, any member of a member-managed limited liability company or
any manager of a manager-managed company may sign and deliver any instrument
transferring or affecting the company's interest in real property.  Such an
instrument shall be conclusively in favor of a person who gives value without
knowledge of the lack of the authority of the person signing and delivering the
instrument. [L 1996, c 92, pt of §1]