Aux Menu
  • 721 First Ave N. St. Petersburg, FL 33701
  • 727-898-7210 Fax 727-898-7218
  • Careers
Mobile Menu

Who Has the Authority to Bind a Limited Liability Company (LLC)?

Who Has the Authority to Bind a Limited Liability Company (LLC)?

Limited Liability Companies (LLCs) have become more common in Florida, but it is not always clear who has the proper authority to bind an LLC. Most people assume that only the person with the fanciest title can bind the LLC; however, the rules for determining authority can be complex and determining whether a person has authority to bind an LLC is not always a straightforward analysis. This begs the questions, “Who has the authority to act on behalf of an LLC?” and “How is that authority granted?”

Member Managed LLCs

In a member managed LLC, each member is an agent of the LLC for the purpose of its activities and affairs. An act of a member, including signing an agreement on behalf of the LLC in the ordinary course of the company’s activities and affairs, binds the company. The only time such action would not bind the company would be if 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.

Manager Managed LLCs

In a manager managed LLC, each manager is an agent of the LLC for the purpose of its activities and affairs, and an act of a manager binds the company. If 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, then the unauthorized action would not be binding on the LLC.

If the thought of the above-referenced analysis leaves too much gray area, you can always establish who has authority to bind the LLC through the LLC’s Articles of Organization, Operating Agreement, or by filing a Statement of Authority with the Secretary of State.

If you have questions related to determining whether a member or manager’s actions are binding to your LLC, please call Englander Fischer at 727-898-7210, or contact us online, to learn how our attorneys can help.

About the Author:

John W. Waechter is a business litigation attorney with Englander Fischer in St. Petersburg, Florida. He represents clients in commercial litigation disputes involving general business litigation, securities, contracts, construction and related areas.

###

This publication is for general information only. It is not legal advice. Legal counsel should be contacted before any action is taken that might be influenced by this publication.

Meet the Firm Meet the Firm
Our team delivers aggressive, levelheaded advocacy with a commonsense approach to business and economic realities.
Join Our Team Join Our Team
We utilize a multi-disciplinary team philosophy with attorneys of varying specialties and points of view.
Meet with Us Meet with Us
Arrange a meeting to tell us your story. We are here to listen and help be your strategic business advocate and partner.
Get In Touch
Florida Legal Elite 2018

Lawyers of Distinction 2018

The Florida Bar

Super Lawyers

Peer Review Rated

Best Law Firms 2020