29-3301. Agency power of member and manager

230 words·~1 min read·/az/title-29/29-3301

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

A. In a member-managed limited liability company, both of the following apply:

1. Each member is an agent of the company for the purpose of conducting the company's activities and affairs in the ordinary course.

2. The act of each member done in the ordinary course of the company's activities and affairs binds the company unless the acting member has in fact no authority to act for the company in the particular matter and the person with whom the member is dealing has knowledge of the fact that the member has no such authority.

B. In a manager-managed limited liability company, all of the following apply:

1. A member is not an agent of the company solely by reason of being a member except to the extent that authority has been delegated to the member by the manager or managers or by the provisions of an operating agreement.

2. Each manager is an agent of the company for the purpose of conducting the company's activities and affairs in the ordinary course.

3. The act of each manager done in the ordinary course of the company's activities and affairs binds the company unless the acting manager has in fact no authority to act for the company in the particular matter and the person with whom the manager is dealing has knowledge of the fact that the manager has no such authority.