Bulletin: CT2017004

Dear Associates:

A Quick Note Regarding the Connecticut Uniform Limited Liability Act 
(Effective July 1, 2017)

Connecticut's new Uniform Limited Liability Company Act (Public Act 16-97; C.G.S. §34-243, et. seq.) brings broad changes to our state's laws regarding limited liability companies (see the link below for the summary and analysis by the Office of Legislative Research). The changes range from the definitional (e.g. "Articles of Organization" are now "Certificates of Organization") to those affecting the most basic aspects of the Members' relationships to the Company (e.g. a Member is no longer an agent for an LLC solely because he/she is a Member; an LLC is deemed "Member-Managed" unless the Operating Agreement provides otherwise; new default voting provisions require a vote of two-thirds "in interest" of the Members for all actions outside the ordinary course of business). However, from the perspective of the real estate practitioner representing the Seller/Buyer of LLC property, underwriting requirements under the new Act remain the same. Practitioners should continue to:

1. Confirm the status of the LLC via Certificate of Legal Existence or other means acceptable to Stewart Title; and  
2. Confirm the authority of the individual(s) signing on behalf of the LLC via examination of the Operating Agreement and (when warranted) procurement of a Resolution evidencing that the requisite voting threshold has been satisfied. Under certain circumstances, Stewart Title will also accept an Opinion Letter from an attorney on this issue.

As always, feel free to contact your partners at Stewart Title with any questions you might have.  

C.G.S.§34-243 - https://www.cga.ct.gov/current/pub/chap_613a.htm

OLR Analysis - https://www.cga.ct.gov/2016/BA/2016HB-05259-R000525-BA.htm

If you have any questions relating to this or other bulletins, please contact a Stewart Title Guaranty Company underwriter.

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