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How do I remove the other governing person from an LLC formed this year with no operating agreement as yet?

Vancouver, WA |
Filed under: Starting an LLC

There are only two governing persons - the other person and me.

Attorney Answers 3

Posted

The prior answer is correct, in the absence of an operating agreement (with specific provisions that govern these types of situations) Washington's LLC statutes will control. Depending on the circumstances there are multiple routes you can take to "remove" the other member of the LLC. You can offer to buy out his interest or you can dissolve the company. Depending on the other member's willingness to dissolve the company, you may be forced to seek a judicial dissolution, see http://apps.leg.wa.gov/rcw/default.aspx?cite=25.15.275 for the statute that governs this type of dissolution. Essentially, if it is not reasonably practicable to carry on the business or there is another equitable reason to dissolve the company, then you can seek a judicial dissolution and the courts can force the company to dissolve. Typically where there are two owners of a business that cannot agree how to run the business (i.e. a deadlock in management), you can force a dissolution of the company.

The best route for you will depend on a variety of factors as well as the particular circumstances you are dealing with. You should consult a business attorney to discuss the particulars and see what your best options are. Good luck!

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In the absence of an operating agreement, the laws of the state where the entity was created will control and usually provide a basic framework for you to proceed. You'll need to consult the statutes, or preferable obtain assistance from a business/transactional attorney who knows them for guidance.

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Before you spend a lot of time and money seeking a judicial dissolution of the LLC, you should consult with an experienced business attorney. Be prepared to provide copies of the formation documents, any emails or other communications with the other founder(s) and to answer a lot of questions, including whether assets were transferred into the LLC. Your attorney should be able to provide you with guidance as to your rights and responsibilities. It would be a really good idea to get good advice before you spend more good money chasing something that may not be worth chasing.

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