Iowa Code 489.14401 – Limitations on liability
Current as of: 2023 | Check for updates
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1. A person is not liable, directly or indirectly, by way of contribution or otherwise, for a debt, obligation, or other liability of any of the following:
a. A protected series of a series limited liability company solely by reason of being or acting as any of the following:
(1) An associated member, protected-series manager, or protected-series transferee of the protected series.
(2) A member, manager, or a transferee of the company.
b. A series limited liability company solely by reason of being or acting as an associated member, protected-series manager, or protected-series transferee of a protected series of the company.
Terms Used In Iowa Code 489.14401
- Associated member: means a member that meets the requirements of section 489. See Iowa Code 489.14102
- Contribution: means any benefit provided by a person to a limited liability company that is any of the following:a. See Iowa Code 489.102
- following: when used by way of reference to a chapter or other part of a statute mean the next preceding or next following chapter or other part. See Iowa Code 4.1
- Manager: means a person that under the operating agreement of a manager-managed limited liability company is responsible, alone or in concert with others, for performing the management functions stated in section 489. See Iowa Code 489.102
- Member: means a person that has become a member of a limited liability company under section 489. See Iowa Code 489.102
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Person: means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, public corporation, government or governmental subdivision, agency, or instrumentality, or any other legal or commercial entity. See Iowa Code 489.102
- Protected-series manager: means a person under whose authority the powers of a protected series are exercised and under whose direction the activities and affairs of the protected series are managed under the operating agreement, this article, and this chapter. See Iowa Code 489.14102
- Protected-series transferee: means a person to which all or part of a protected-series transferable interest of a protected series of a series limited liability company has been transferred, other than the company. See Iowa Code 489.14102
- Transferable interest: means the right, as originally associated with a person's capacity as a member, to receive distributions from a limited liability company in accordance with the operating agreement, whether or not the person remains a member or continues to own any part of the right. See Iowa Code 489.102
- Transferee: means a person to which all or part of a transferable interest has been transferred, whether or not the transferor is a member. See Iowa Code 489.102
2. Subject to section 489.14404, all of the following rules apply:a. A debt, obligation, or other liability of a series limited liability company is solely the debt, obligation, or liability of the company.b. A debt, obligation, or other liability of a protected series is solely the debt, obligation, or liability of the protected series.c. A series limited liability company is not liable, directly or indirectly, by way of contribution or otherwise, for a debt, obligation, or other liability of a protected series of the company solely by reason of the protected series being a protected series of the company or the company for any of the following:(1) Being or acting as a protected-series manager of the protected series.(2) Having the protected series manage the company.(3) Owning a protected-series transferable interest of the protected series.d. A protected series of a series limited liability company is not liable, directly or indirectly, by way of contribution or otherwise, for a debt, obligation, or other liability of the company or another protected series of the company solely by reason of any of the following:(1) Being a protected series of the company.(2) Being or acting as a manager of the company or a protected-series manager of another protected series of the company.(3) Having the company or another protected series of the company be or act as a protected-series manager of the protected series.