183.0406 Liability for improper distributions.

295 words·~1 min read·/wi/chapter-183/183-0406-4

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

(1)Except as otherwise provided in sub.

(2), if a member of a member-managed limited liability company or manager of a manager-managed limited liability company consents to a distribution made in violation of s. 183.0405 and in consenting to the distribution fails to comply with s. 183.0409 , the member or manager is personally liable to the company for the amount of the distribution which exceeds the amount that could have been distributed without the violation of s. 183.0405 .

(2)To the extent a written operating agreement of a member-managed limited liability company relieves a member of the authority and responsibility to consent to distributions and imposes that authority and responsibility on one or more other members, the liability stated in sub.

(1)applies to the other members and not the member that the written operating agreement relieves of the authority and responsibility.

(3)A person that receives a distribution knowing that the distribution violated s. 183.0405 is personally liable to the limited liability company but only to the extent that the distribution received by the person exceeded the amount that could have been properly paid under s. 183.0405 .

(4)A person against which an action is commenced because the person is liable under sub.

(1)may do any of the following:

(a)Implead any other person that is subject to liability under sub.

(1)and seek to enforce a right of contribution from the person.

(b)Implead any person that is subject to liability under sub.

(3)and seek to enforce a right of contribution from the person in the amount of the liability under sub.

(3).

(5)An action under this section is barred unless commenced not later than 2 years after the distribution.