AN ACT Relating to
registered limited liability partnerships; amending RCW 25.15.005, 25.15.045,
25.15.060, 25.15.085, 25.15.130, 25.15.220, 25.15.250, 25.15.280, 25.15.310,
and 24.06.045; adding new sections to chapter 25.04 RCW; providing an effective
date; and declaring an emergency.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF
WASHINGTON:
NEW SECTION. Sec.
1. This subchapter applies
to limited liability partnerships. All other provisions of this chapter, not
in conflict with this subchapter, also apply.
NEW SECTION. Sec.
2. Unless the context
clearly requires otherwise, the definitions in this section apply throughout
this subchapter.
(1) "Limited
liability partnership" or "partnership" means a partnership
formed pursuant to an agreement governed by the laws of this state, registered
under section 6 of this act.
(2) "Foreign
limited liability partnership" means a limited liability partnership
formed pursuant to an agreement governed by the laws of another jurisdiction.
NEW SECTION. Sec.
3. (1) To become and to
continue as a limited liability partnership, a partnership shall file with the
secretary of state an application stating the name of the partnership; the
address of its principal office; if the partnership's principal office is not
located in this state, the address of a registered office and the name and
address of a registered agent for service of process in this state which the
partnership will be required to maintain; the number of partners; a brief
statement of the business in which the partnership engages; any other matters
that the partnership determines to include; and that the partnership thereby
applies for status as a limited liability partnership.
(2) The application
shall be executed by a majority in interest of the partners or by one or more
partners authorized to execute an application.
(3) The application
shall be accompanied by a fee of one hundred seventy-five dollars for each
partnership.
(4) The secretary of
state shall register as a limited liability partnership any partnership that
submits a completed application with the required fee.
(5) A partnership
registered under this section shall pay an annual fee, in each year following
the year in which its application is filed, on a date and in an amount
specified by the secretary of state. The fee must be accompanied by a notice,
on a form provided by the secretary of state, of the number of partners
currently in the partnership and of any material changes in the information
contained in the partnership's application for registration.
(6) Registration is
effective immediately after the date an application is filed, and remains
effective until: (a) It is voluntarily withdrawn by filing with the secretary
of state a written withdrawal notice executed by a majority in interest of the
partners or by one or more partners authorized to execute a withdrawal notice;
or (b) thirty days after receipt by the partnership of a notice from the
secretary of state, which notice shall be sent by certified mail, return
receipt requested, that the partnership has failed to make timely payment of
the annual fee specified in subsection (5) of this section, unless the fee is
paid within such a thirty-day period.
(7) The status of a
partnership as a limited liability partnership, and the liability of the
partners thereof, shall not be affected by: (a) Errors in the information
stated in an application under subsection (1) of this section or a notice under
subsection (5) of this section; or (b) changes after the filing of such an
application or notice in the information stated in the application or notice.
(8) The secretary of
state may provide forms for the application under subsection (1) of this
section or a notice under subsection (5) of this section.
NEW SECTION. Sec.
4. The name of a limited
liability partnership shall contain the words "limited liability
partnership" or the abbreviation "L.L.P." or "LLP" as
the last words or letters of its name.
NEW SECTION. Sec.
5. A person or group of
persons licensed or otherwise legally authorized to render professional
services, as defined in RCW 18.100.030, within this state may organize and
become a member or members of a limited liability partnership under the
provisions of this chapter for the purposes of rendering professional service.
Nothing in this section prohibits a person duly licensed or otherwise legally
authorized to render professional services in any jurisdiction other than this
state from becoming a member of a limited liability partnership organized for
the purpose of rendering the same professional services. Nothing in this
section prohibits a limited liability partnership from rendering professional
services outside this state through individuals who are not duly licensed or
otherwise legally authorized to render such professional services within this
state.
NEW SECTION. Sec.
6. (1) A limited liability
partnership formed and existing under this chapter, may conduct its business,
carry on its operations, and have and exercise the powers granted by this chapter
in any state, territory, district, or possession of the United States or in any
foreign country.
(2) It is the intent of
the legislature that the legal existence of a limited liability partnership
formed and existing under this chapter be recognized outside the boundaries of
this state and that the laws of this state governing a limited liability
partnership transacting business outside this state be granted the protection
of full faith and credit under the Constitution of the United States.
(3) The internal
affairs of a partnership, including a limited liability partnership formed and
existing under this chapter, including the liability of partners for debts,
obligations, and liabilities of or chargeable to the partnership, shall be
subject to and governed by the laws of this state.
(4) Subject to any
statutes for the regulation and control of specific types of business, a
foreign limited liability partnership, formed and existing under the laws of
another jurisdiction, may do business in this state provided it registers with
the secretary of state under this chapter in the same manner as a limited
liability partnership.
(5) It is the policy of
this state that the internal affairs of a foreign limited liability
partnership, including the liability of partners for debts, obligations, and
liabilities of or chargeable to partnerships, shall be subject to and governed
by the laws of such other jurisdiction. However, a foreign limited liability
partnership formed and existing under the laws of another jurisdiction is
subject to section 7 of this act if it renders professional services, as
defined in RCW 18.100.030, in this state.
NEW SECTION. Sec.
7. (1) Except as provided in
subsection (2) of this section, all partners are liable:
(a) Jointly and
severally for everything chargeable to the partnership under RCW 25.04.130 and
25.04.140; and
(b) Jointly for all
other debts and obligations of the partnership; but any partner may enter into
a separate obligation to perform a partnership contract;
(c) Except that:
(i) In no event shall a
trustee or personal representative, a fiduciary, acting as a partner have
personal liability except as provided in RCW 11.98.110 (2) and (4);
(ii) Any such liability
under this section shall be satisfied first from the partnership assets and
second from the trust or estate; and
(iii) If a fiduciary is
liable, the fiduciary is entitled to indemnification first from the partnership
assets and second from the trust or estate.
(2) Subject to subsections
(3) and (5) of this section, a partner in a limited liability partnership is
not liable directly or indirectly, including by way of indemnification,
contribution, assessment, or otherwise for debts, obligations, and liabilities
of or chargeable to the partnership, whether in tort, contract or otherwise,
arising from omissions, negligence, wrongful acts, misconduct, or malpractice
committed in the course of the partnership business by another partner or an
employee, agent, or representative of the partnership.
(3) Subsection (2) of
this section shall not affect the liability of a partner in a limited liability
partnership for his or her own omissions, negligence, wrongful acts,
misconduct, or malpractice or that of any person under his or her direct supervision
and control.
(4) A partner in a
limited liability partnership is not a proper party to a proceeding by or
against a limited liability partnership, the object of which is to recover
damages or enforce the obligations arising from omissions, negligence, wrongful
acts, misconduct, or malpractice described in subsection (2) of this section,
unless such partner is personally liable under subsection (3) or (5) of this
section.
(5) If the partners of
a limited liability partnership or foreign limited liability partnership are
required to be licensed to provide professional services, as defined in RCW
18.100.030, and the partnership fails to maintain for itself and for its
members practicing in this state a policy of professional liability insurance, bond,
deposit in trust, bank escrow of cash, bank certificates of deposit, United
States Treasury obligations, bank letter of credit, insurance company bond, or
other evidence of financial responsibility of a kind designated by rule by the
state insurance commissioner and in the amount of at least one million dollars
or such greater amount, not to exceed three million dollars, as the state
insurance commissioner may establish by rule for a licensed profession or for
any specialty within a profession, taking into account the nature and size of
the businesses within the profession or specialty, then the partners shall be
personally liable to the extent that, had such insurance, bond, deposit in
trust, bank escrow of cash, bank certificates of deposit, United States
Treasury obligations, bank letter of credit, insurance company bond, or other
evidence of responsibility been maintained, it would have covered the liability
in question.
NEW SECTION. Sec.
8. The rights and duties of
the partners in relation to the partnership shall be determined, subject to any
agreement between them, by the following rules:
(1) Each partner shall
be repaid his or her contributions, whether by way of capital or advances to
the partnership property and share equally in the profits and surplus remaining
after all liabilities, including those to partners, are satisfied; and except
as provided in section 7(2) of this act, each partner must contribute toward
the losses, whether of capital or otherwise, sustained by the partnership
according to his or her share in the profits.
(2) The partnership
must indemnify every partner in respect of payments made and personal
liabilities reasonably incurred by him or her in the ordinary and proper
conduct of its business, or for the preservation of its business or property.
(3) A partner, who in
aid of the partnership makes any payment or advance beyond the amount of
capital which he or she agreed to contribute, shall be paid interest from the
date of the payment or advance.
(4) A partner shall
receive interest on the capital contributed by him or her only from the date
when repayment should be made.
(5) All partners have
equal rights in the management and conduct of the partnership business.
(6) No partner is
entitled to remuneration for acting in the partnership business, except that a
surviving partner is entitled to reasonable compensation for his or her
services in winding up the partnership affairs.
(7) No person can
become a member of a partnership without the consent of all the partners.
(8) Any difference
arising as to ordinary matters connected with the partnership business may be decided
by a majority of the partners; but no act in contravention of any agreement
between the partners may be done rightfully without the consent of all the
partners.
NEW SECTION. Sec.
9. Where a dissolution is
caused by the act, death, or bankruptcy of a partner, each partner is liable to
his or her copartners for his or her share of any liability created by any
partner acting for the partnership as if the partnership had not been dissolved
unless:
(1) The dissolution
being by act of any partner, the partner acting for the partnership had
knowledge of the dissolution; or
(2) The dissolution
being by the death or bankruptcy of a partner, the partner acting for the
partnership had knowledge or notice of the death or bankruptcy; or
(3) The liability is
for a debt, obligation, or liability for which the partner is not liable as
provided in section 7(2) of this act.
NEW SECTION. Sec.
10. (1) The dissolution of
the partnership does not of itself discharge the existing liability of any
partner.
(2) A partner is
discharged from any existing liability upon dissolution of the partnership by
an agreement to that effect between himself or herself, the partnership
creditor and the person or partnership continuing the business; and such
agreement may be inferred from the course of dealing between the creditor
having knowledge of the dissolution and the person or partnership continuing
the business.
(3) Where a person
agrees to assume the existing obligations of a dissolved partnership, the
partners whose obligations have been assumed shall be discharged from any
liability to any creditor of the partnership who, knowing of the agreement,
consents to a material alteration in the nature or time of payment of such
obligations.
(4) The individual
property of a deceased partner shall be liable for those obligations of the
partnership incurred while he or she was a partner and for which he or she was
liable under section 7 of this act, but subject to the prior payment of his or
her separate debts.
NEW SECTION. Sec.
11. In settling accounts
between the partners after dissolution, the following rules shall be observed,
subject to any agreement to the contrary:
(1) The assets of the
partnership are:
(a) The partnership
property;
(b) The contributions
of the partners specified in subsection (4) of this section.
(2) The liabilities of
the partnership shall rank in order of payment, as follows:
(a) Those owing to
creditors other than partners;
(b) Those owing to
partners other than for capital and profits;
(c) Those owing to
partners in respect of capital;
(d) Those owing to
partners in respect of profits.
(3) The assets shall be
applied in the order of their declaration in subsection (1) of this section to
the satisfaction of the liabilities.
(4) Except as provided
in section 7(2) of this act: (a) The partners shall contribute, as provided by
section 8(1) of this act the amount necessary to satisfy the liabilities; and
(b) if any, but not all, of the partners are insolvent, or, not being subject
to process, refuse to contribute, the other partners shall contribute their
share of the liabilities, and, in the relative proportions in which they share
the profits, the additional amount necessary to pay the liabilities.
(5) An assignee for the
benefit of creditors or any person appointed by the court shall have the right
to enforce the contribution specified in subsection (4) of this section.
(6) Any partner or his
or her legal representative shall have the right to enforce the contributions
specified in subsection (4) of this section, to the extent of the amount which
he or she has paid in excess of his or her share of the liability.
(7) The individual
property of a deceased partner shall be liable for the contributions specified
in subsection (4) of this section.
(8) When partnership
property and the individual properties of the partners are in possession of a
court for distribution, partnership creditors shall have priority on
partnership property and separate creditors on individual property, saving the
rights of lien or secured creditors as heretofore.
(9) Where a partner has
become bankrupt or his or her estate is insolvent the claims against his or her
separate property shall rank in the following order:
(a) Those owing to
separate creditors;
(b) Those owing to
partnership creditors;
(c) Those owing to
partners by way of contribution.
NEW SECTION. Sec.
12. Sections 1 through 11 of
this act are each added to chapter 25.04 RCW and codified with the subchapter
heading of "limited liability partnerships."
Sec. 13. RCW 25.15.005 and 1994 c
211 s 101 are each amended to read as follows:
As used in this
chapter, unless the context otherwise requires:
(1) "Certificate
of formation" means the certificate referred to in RCW 25.15.070, and the
certificate as amended.
(2) "Event of
dissociation" means an event that causes a person to cease to be a member
as provided in RCW 25.15.130.
(3) "Foreign
limited liability company" means an entity that is formed under:
(a) ((An
unincorporated enterprise;
(b) Organized under
the)) The limited liability
company laws of ((a)) any state other than ((the laws of))
this state, or ((under the))
(b) The laws of
any foreign country((;
(c) Organized)) that is: (A) An unincorporated
association, (B) formed under a statute pursuant to which an ((enterprise))
association may be formed that affords to each of its members limited
liability with respect to the liabilities of the entity((;)), and
(((d) Is)) (C) not required, in order to transact business or
conduct affairs in this state, to be registered or ((organized under any
statute of this state other than this chapter)) qualified under Title
23B or 24 RCW, or any other chapter of the Revised Code of Washington
authorizing the formation of a domestic entity and the registration or
qualification in this state of similar entities formed under the laws of a
jurisdiction other than this state.
(4) "Limited
liability company" and "domestic limited liability company"
means a limited liability company organized and existing under this chapter.
(5) "Limited
liability company agreement" means any written agreement as to the affairs
of a limited liability company and the conduct of its business which is binding
upon all of the members.
(6) "Limited
liability company interest" means a member's share of the profits and losses
of a limited liability company and a member's right to receive distributions of
the limited liability company's assets.
(7) "Manager"
or "managers" means, with respect to a limited liability company that
has set forth in its certificate of formation that it is to be managed by
managers, the person, or persons designated in accordance with RCW
25.15.150(2).
(8) "Member"
means a person who has been admitted to a limited liability company as a member
as provided in RCW 25.15.115 and who has not been dissociated from the limited
liability company.
(9) "Person"
means a natural person, partnership (whether general or limited and whether
domestic or foreign), limited liability company, foreign limited liability
company, trust, estate, association, corporation, custodian, nominee, or any
other individual or entity in its own or any representative capacity.
(10) "Professional
limited liability company" means a limited liability company which is
organized for the purpose of rendering professional service and whose
certificate of formation sets forth that it is a professional limited liability
company subject to RCW 25.15.045.
(11) "Professional
service" means ((any type of personal service to the public which
requires as a condition precedent to the rendering of such service the
obtaining of a license or other legal authorization, including, but not by way
of limitation, certified public accountants, architects, veterinarians,
attorneys at law, and health professions regulated under chapter 18.130 RCW))
the same as defined under RCW 18.100.030.
(12) "State"
means the District of Columbia or the Commonwealth of Puerto Rico or any state,
territory, possession, or other jurisdiction of the United States other than
the state of Washington.
Sec. 14. RCW 25.15.045 and 1994 c
211 s 109 are each amended to read as follows:
(1) A person or group
of persons licensed or otherwise legally authorized to render professional
services within this state may organize and become a member or members of a
professional limited liability company under the provisions of this chapter for
the purposes of rendering professional service. A "professional limited
liability company" is subject to all the provisions of chapter 18.100 RCW
that apply to a professional corporation, and its managers, members, agents,
and employees shall be subject to all the provisions of chapter 18.100 RCW that
apply to the directors, officers, shareholders, agents, or employees of a
professional corporation, except as provided otherwise in this section.
Nothing in this section prohibits a person duly licensed or otherwise legally
authorized to render professional services in any jurisdiction other than this
state from becoming a member of a professional limited liability company
organized for the purpose of rendering the same professional services. Nothing
in this section prohibits a professional limited liability company from
rendering professional services outside this state through individuals who are
not duly licensed or otherwise legally authorized to render such professional
services within this state. Notwithstanding RCW 18.100.065, persons engaged in
a profession and otherwise meeting the requirements of this chapter may operate
under this chapter as a professional limited liability company so long as each
member personally engaged in the practice of the profession in this state is
duly licensed or otherwise legally authorized to practice the profession in
this state and:
(a) At least one
manager of the company is duly licensed or otherwise legally authorized to
practice the profession in this state; ((and)) or
(b) Each ((resident
manager or)) member in charge of an office of the company in this state ((and
each resident manager or member personally engaged in this state in the
practice of the profession)) is duly licensed or otherwise legally
authorized to practice the profession in this state.
(2) If the company's
members are required to be licensed to practice such profession, and the
company fails to maintain for itself and for its members practicing in this
state a policy of professional liability insurance, bond, or other evidence of
financial responsibility of a kind designated by rule by the state insurance
commissioner and in the amount of at least one million dollars or such greater
amount as the state insurance commissioner may establish by rule for a licensed
profession or for any specialty within a profession, taking into account the
nature and size of the business, then the company's members shall be personally
liable to the extent that, had such insurance, bond, or other evidence of
responsibility been maintained, it would have covered the liability in
question.
(3) For purposes of
applying the provisions of chapter 18.100 RCW to a professional limited
liability company, the terms "director" or "officer" shall
mean manager, "shareholder" shall mean member,
"corporation" shall mean professional limited liability company,
"articles of incorporation" shall mean certificate of formation,
"shares" or "capital stock" shall mean a limited liability
company interest, "incorporator" shall mean the person who executes
the certificate of formation, and "bylaws" shall mean the limited
liability company agreement.
(4) The name of a
professional limited liability company must contain either the words
"Professional Limited Liability Company," or the words "Professional
Limited Liability" and the abbreviation "Co.," or the
abbreviation "P.L.L.C." provided that the name of a professional
limited liability company organized to render dental services shall contain the
full names or surnames of all members and no other word than
"chartered" or the words "professional services" or the
abbreviation "P.L.L.C."
(5) Subject to the
provisions in article VII of this chapter, the following may be a member of a
professional limited liability company and may be the transferee of the
interest of an ineligible person or deceased member of the professional limited
liability company:
(a) A professional
corporation, if its shareholders, directors, and its officers other than the
secretary and the treasurer, are licensed or otherwise legally authorized to
render the same specific professional services as the professional limited
liability company; and
(b) Another
professional limited liability company, if the managers and members of both
professional limited liability companies are licensed or otherwise legally
authorized to render the same specific professional services.
Sec. 15. RCW 25.15.060 and 1994 c
211 s 112 are each amended to read as follows:
Members of a limited
liability company shall be personally liable for any act, debt, obligation, or
liability of the limited liability company to the extent that shareholders of a
Washington business corporation would be liable in analogous circumstances. In
this regard, the court may consider the factors and policies set forth in
established case law with regard to piercing the corporate veil, except that
the failure to hold meetings of members or managers or the failure to observe
formalities pertaining to the calling or conduct of meetings shall not be considered
a factor tending to establish that the members have personal liability for any
act, debt, obligation, or liability of the limited liability company if the
certificate of formation and limited liability company agreement do not
expressly require the holding of meetings of members or managers.
Sec. 16. RCW 25.15.085 and 1994 c
211 s 204 are each amended to read as follows:
(1) Each document
required by this chapter to be filed in the office of the secretary of state
shall be executed in the following manner:
(a) Each original
certificate of formation must be signed by the person or persons forming the
limited liability company;
(b) A reservation of
name may be signed by any person;
(c) A transfer of
reservation of name must be signed by, or on behalf of, the applicant
for the reserved name;
(d) A registration of
name must be signed by any member or manager of the foreign limited liability
company;
(e) A certificate of
amendment or restatement must be signed by at least one manager, or by a member
if management of the limited liability company is reserved to the members;
(f) A certificate of
cancellation must be signed by the person or persons authorized to wind up the
limited liability company's affairs pursuant to RCW 25.15.295(1);
(g) If a surviving
domestic limited liability company is filing articles of merger, the articles
of merger must be signed by at least one manager, or by a member if management
of the limited liability company is reserved to the members, or if the articles
of merger are being filed by a surviving foreign limited liability company,
limited partnership, or corporation, the articles of merger must be signed by a
person authorized by such foreign limited liability company, limited
partnership, or corporation; and
(h) A foreign limited
liability company's application for registration as a foreign limited liability
company doing business within the state must be signed by any member or manager
of the foreign limited liability company.
(2) Any person may sign
a certificate, articles of merger, ((or)) limited liability company
agreement, or other document by an attorney-in-fact or other person
acting in a valid representative capacity, so long as each document signed
in such manner identifies the capacity in which the signator signed.
(3) The person
executing the document shall sign it and state beneath or opposite the
signature the name of the person and capacity in which the person signs. The
document must be typewritten or printed, and must meet such legibility or other
standards as may be prescribed by the secretary of state.
(4) The execution of a
certificate or articles of merger by any person constitutes an affirmation
under the penalties of perjury that the facts stated therein are true.
Sec. 17. RCW 25.15.130 and 1994 c
211 s 304 are each amended to read as follows:
(1) A person ceases to
be a member of a limited liability company upon the occurrence of one or more
of the following events:
(a) The member dies
or withdraws by voluntary act from the limited liability company as
provided in subsection (3) of this section;
(b) The member ceases
to be a member as provided in RCW 25.15.250(2)(b) following an assignment of
all the member's limited liability company interest;
(c) The member is
removed as a member in accordance with the limited liability company agreement;
(d) Unless otherwise
provided in the limited liability company agreement, or with the written
consent of all other members at the time, the member (i) makes a general
assignment for the benefit of creditors; (ii) files a voluntary petition in
bankruptcy; (iii) becomes the subject of an order for relief in bankruptcy
proceedings; (iv) files a petition or answer seeking for himself or herself any
reorganization, arrangement, composition, readjustment, liquidation,
dissolution, or similar relief under any statute, law, or regulation; (v) files
an answer or other pleading admitting or failing to contest the material
allegations of a petition filed against him or her in any proceeding of the
nature described in (d) (i) through (iv) of this subsection; or (vi) seeks,
consents to, or acquiesces in the appointment of a trustee, receiver, or
liquidator of the member or of all or any substantial part of the member's
properties;
(e) Unless otherwise
provided in the limited liability company agreement, or with the consent of all
other members at the time, one hundred twenty days after the commencement of
any proceeding against the member seeking reorganization, arrangement,
composition, readjustment, liquidation, dissolution, or similar relief under
any statute, law, or regulation, the proceeding has not been dismissed, or if
within ninety days after the appointment without his or her consent or
acquiescence of a trustee, receiver, or liquidator of the member or of all or
any substantial part of the member's properties, the appointment is not vacated
or stayed, or within ninety days after the expiration of any stay, the
appointment is not vacated;
(f) Unless otherwise
provided in the limited liability company agreement, or with written consent of
all other members at the time, in the case of a member who is an individual,
the entry of an order by a court of competent jurisdiction adjudicating the
member ((incompetent to manage his or her person or estate)) incapacitated,
as used and defined under chapter 11.88 RCW, as to his or her estate;
(g) Unless otherwise
provided in the limited liability company agreement, or with written consent of
all other members at the time, in the case of a member that is another limited
liability company, the dissolution and commencement of winding up of such
limited liability company;
(h) Unless otherwise
provided in the limited liability company agreement, or with written consent of
all other members at the time, in the case of a member that is a corporation,
the filing of articles of dissolution or the equivalent for the corporation or the
administrative dissolution of the corporation and the lapse of any period
authorized for application for reinstatement; or
(i) Unless otherwise
provided in the limited liability company agreement, or with written consent of
all other members at the time, in the case of a member that is a limited
partnership, the dissolution and commencement of winding up of such limited
partnership.
(2) The limited
liability company agreement may provide for other events the occurrence of
which result in a person ceasing to be a member of the limited liability
company.
(3) ((Unless
otherwise provided in the limited liability company agreement,)) A
member may withdraw from a limited liability company at ((any time by giving
thirty days' written notice to the other members)) the time or upon the
happening of events specified in and in accordance with the limited liability
company agreement. If the limited liability company agreement does not specify
the time or the events upon the happening of which a member may withdraw, a
member may not withdraw prior to the time for the dissolution and commencement
of winding up of the limited liability company, without the written consent of
all other members at the time.
Sec. 18. RCW 25.15.220 and 1994 c
211 s 602 are each amended to read as follows:
Unless otherwise
provided in the limited liability company agreement, upon the occurrence of
an event of dissociation under RCW 25.15.130 which does not cause dissolution
(other than an event of dissociation specified in RCW 25.15.130(((2))) (1)(b)
where the dissociating member's assignee is admitted as a member), a
dissociating member (or the member's assignee) is entitled to receive any
distribution to which ((the member (or assignee) is entitled under the
limited liability company agreement and, if not otherwise provided in a limited
liability company agreement, the member (or the member's assignee) is entitled
to receive, within a reasonable time after dissociation, the fair value of the
member's limited liability company interest as of the date of the dissociation
based upon the member's right to share in distributions from the limited
liability company)) an assignee would be entitled.
Sec. 19. RCW 25.15.250 and 1994 c
211 s 702 are each amended to read as follows:
(1) A limited liability
company interest is assignable in whole or in part except as provided in a
limited liability company agreement. The assignee of a member's limited
liability company interest shall have no right to participate in the management
of the business and affairs of a limited liability company except:
(a) Upon the approval
of all of the members of the limited liability company other than the member
assigning his or her limited liability company interest; or
(b) As provided in a
limited liability company agreement.
(2) Unless otherwise
provided in a limited liability company agreement:
(a) An assignment
entitles the assignee to share in such profits and losses, to receive such
distributions, and to receive such allocation of income, gain, loss, deduction,
or credit or similar item to which the assignor was entitled, to the extent
assigned; and
(b) A member ceases to
be a member and to have the power to exercise any rights or powers of a member
upon assignment of all of his or her limited liability company interest.
(3) For the purposes of
this chapter, unless otherwise provided in a limited liability company
agreement:
(a) The pledge of, or
granting of a security interest, lien, or other encumbrance in or against, any
or all of the limited liability company interest of a member shall not be
deemed to be an assignment of the member's limited liability company interest,
but a foreclosure or execution sale or exercise of similar rights with respect
to all of a member's limited liability company interest shall be deemed to be
an assignment of the member's limited liability company interest to the
transferee pursuant to such foreclosure or execution sale or exercise of
similar rights;
(b) ((The death of a
member who is an individual shall be deemed to be an assignment of that
member's entire limited liability company interest to his or her personal
representative;
(c))) Where a limited liability company interest is
held in a trust or estate, or is held by a trustee, personal representative, or
other fiduciary, the transfer of the limited liability company interest,
whether to a beneficiary of the trust or estate or otherwise, shall be deemed
to be an assignment of such limited liability company interest, but the mere
substitution or replacement of the trustee, personal representative, or other
fiduciary shall not constitute an assignment of any portion of such limited
liability company interest.
(4) Unless otherwise
provided in a limited liability company agreement and except to the extent
assumed by agreement, until an assignee of a limited liability company interest
becomes a member, the assignee shall have no liability as a member solely as a
result of the assignment.
Sec. 20. RCW 25.15.280 and 1994 c
211 s 803 are each amended to read as follows:
The secretary of state
may commence a proceeding under RCW 25.15.285 to administratively dissolve a
limited liability company if:
(1) The limited
liability company does not pay any license fees or penalties, imposed by this
chapter, when they become due;
(2) The limited
liability company does not deliver its completed initial report or annual
report to the secretary of state when it is due;
(3) The limited
liability company is without a registered agent or registered office in this
state for sixty days or more; or
(((2))) (4)
The limited liability company does not notify the secretary of state within
sixty days that its registered agent or registered office has been changed,
that its registered agent has resigned, or that its registered office has been
discontinued.
Sec. 21. RCW 25.15.310 and 1994 c
211 s 901 are each amended to read as follows:
(1) Subject to the
Constitution of the state of Washington:
(a) The laws of the
state, territory, possession, or other jurisdiction or country under which a
foreign limited liability company is organized govern its organization and
internal affairs and the liability of its members and managers; and
(b) A foreign limited
liability company may not be denied registration by reason of any difference
between those laws and the laws of this state.
(2) A foreign limited
liability company is subject to RCW 25.15.030 and, notwithstanding
subsection (1)(a) of this section, a foreign limited liability company
rendering professional services in this state is also subject to RCW
25.15.045(2).
(3) A foreign limited
liability company and its members and managers doing business in this state
thereby submit to personal jurisdiction of the courts of this state and are
subject to RCW 25.15.125.
Sec. 22. RCW 24.06.045 and 1994 c
211 s 1307 are each amended to read as follows:
The corporate name:
(1) Shall not contain
any word or phrase which indicates or implies that it is organized for any
purpose other than one or more of the purposes contained in its articles of incorporation.
(2) Shall not be the
same as, or deceptively similar to, the name of any corporation existing under
any act of this state, or any foreign corporation authorized to transact
business or conduct affairs in this state under any act of this state, or the
name of any limited liability ((corporation)) company organized
or authorized to transact business under any act of this state, the name of a
domestic or foreign limited partnership on file with the secretary, or a
corporate name reserved or registered as permitted by the laws of this state.
This subsection shall not apply if the applicant files with the secretary of
state either of the following: (a) The written consent of the other
corporation, limited liability company, limited partnership, or holder of a
reserved name to use the same or deceptively similar name and one or more words
are added or deleted to make the name distinguishable from the other name as
determined by the secretary of state, or (b) a certified copy of a final decree
of a court of competent jurisdiction establishing the prior right of the
applicant to the use of the name in this state.
(3) Shall be
transliterated into letters of the English alphabet if it is not in English.
(4) The name of any
corporation formed under this section shall not include nor end with
"incorporated", "company", or "corporation" or
any abbreviation thereof, but may use "club", "league",
"association", "services", "committee",
"fund", "society", "foundation","
. . . . . ., a nonprofit mutual corporation", or
any name of like import.
NEW SECTION. Sec.
23. This act is necessary for
the immediate preservation of the public peace, health, or safety, or support
of the state government and its existing public institutions, and shall take
effect July 1, 1995.
