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The Law on Dissolution of Limited Liability Companies
In an action filed by a manager or a member of
a Limited Liability Company, the court may order the dissolution of a
limited liability company under any of the following circumstances:
(a) It is not reasonably practicable to carry on the business in
conformity with the articles of organization or the operating
agreement. (Corp.C. 17351(a)(1).) (b)
Dissolution is reasonably necessary to protect the rights or
interests of the complaining members. (Corp.C. 17351(a)(2).) (c) The business has been abandoned.
(Corp.C. 17351(a)(3).) (d) Management is
deadlocked or subject to internal dissension. (Corp.C. 17351(a)(4)); or (e) Those in control of the company have
been guilty of, or have knowingly countenanced, persistent and
pervasive fraud, mismanagement, or abuse of authority. (Corp.C.
17351(a)(5).) The law provides that other
members may avoid the dissolution by purchasing for cash at fair
market value the membership interests of the members initiating the
dissolution proceeding. (Corp.C. 17351 (b)(1).)
We have helped numerous clients resolve partnership and membership
litigation. For more information in disputes among members of
a Limited Liability Company, please call the office.
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