Ohio Code 1706.765 – Separate asset series-circumstances causing dissociation from series
A person is dissociated as a member associated with a series when any of the following occurs:
Terms Used In Ohio Code 1706.765
- Assignment: means a transfer, conveyance, deed, bill of sale, lease, mortgage, security interest, encumbrance, gift, or transfer by operation of law. See Ohio Code 1706.01
- Bankruptcy: Refers to statutes and judicial proceedings involving persons or businesses that cannot pay their debts and seek the assistance of the court in getting a fresh start. Under the protection of the bankruptcy court, debtors may discharge their debts, perhaps by paying a portion of each debt. Bankruptcy judges preside over these proceedings.
- Entity: means a general partnership, limited partnership, limited liability partnership, limited liability company, association, corporation, professional corporation, professional association, nonprofit corporation, business trust, real estate investment trust, common law trust, statutory trust, cooperative association, or any similar organization that has a governing statute, in each case, whether foreign or domestic. See Ohio Code 1706.01
- Guardian: A person legally empowered and charged with the duty of taking care of and managing the property of another person who because of age, intellect, or health, is incapable of managing his (her) own affairs.
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- Member: means a person that has been admitted as a member of a limited liability company under section 1706. See Ohio Code 1706.01
- Membership interest: means a member's right to receive distributions from a limited liability company or series thereof. See Ohio Code 1706.01
- Operating agreement: includes any amendments to the operating agreement. See Ohio Code 1706.01
- Person: means an individual, entity, trust, estate, government, custodian, nominee, trustee, personal representative, fiduciary, or any other individual, entity, or series thereof in its own or any representative capacity, in each case, whether foreign or domestic. See Ohio Code 1706.01
- Property: means real and personal property. See Ohio Code 1.59
- Tribunal: means a court or, if provided in the operating agreement or otherwise agreed, an arbitrator, arbitration panel, or other tribunal. See Ohio Code 1706.01
- Trustee: A person or institution holding and administering property in trust.
(A) An event stated in the operating agreement as causing the person’s dissociation from the series occurs.
(B) The person is dissociated as a member of the limited liability company pursuant to section 1706.411 of the Revised Code.
(C) The person is expelled as a member associated with that series pursuant to the operating agreement.
(D) The person is expelled as a member associated with the series by the unanimous consent of the other members associated with that series and if any of the following applies:
(1) It is unlawful to carry on the series’ activities with the person as a member associated with that series.
(2) The person is an entity and, within ninety days after the series notifies the person that it will be expelled as a member associated with that series because the person has filed a certificate of dissolution or the equivalent, or its right to transact business has been suspended by its jurisdiction of formation, the certificate of dissolution or the equivalent has not been revoked or its right to transact business has not been reinstated.
(3) The person is an entity and, within ninety days after the series notifies the person that it will be expelled as a member associated with that series because the person has been dissolved and its activities are being wound up, the entity has not been reinstated or the dissolution and winding up have not been revoked or canceled.
(E) On application by the series, the person is expelled as a member associated with that series by tribunal order for any of the following reasons:
(1) The person has engaged, or is engaging, in wrongful conduct that has adversely and materially affected, or will adversely and materially affect, that series’ activities.
(2) The person has willfully or persistently committed, or is willfully or persistently committing, a material breach of the operating agreement or the person’s duties or obligations under this chapter or other applicable law.
(3) The person has engaged, or is engaging, in conduct relating to that series’ activities that makes it not reasonably practicable to carry on the activities with the person as a member associated with that series.
(F) In the case of a person who is an individual, the person dies, a guardian or general conservator is appointed for the person, or a tribunal determines that the person has otherwise become incapable of performing the person’s duties as a member associated with a series under this chapter or the operating agreement.
(G) The person becomes a debtor in bankruptcy, executes an assignment for the benefit of creditors, or seeks, consents, or acquiesces to the appointment of a trustee, receiver, or liquidator of the person or of all or substantially all of the person’s property. This division shall not apply to a person who is the sole remaining member associated with a series.
(H) In the case of a person that is a trust or is acting as a member associated with a series by virtue of being a trustee of a trust, the trust’s entire membership interest associated with the series is distributed, but not solely by reason of the substitution of a successor trustee.
(I) In the case of a person that is an estate or is acting as a member associated with a series by virtue of being a personal representative of an estate, the estate’s entire membership interest associated with the series is distributed, but not solely by reason of the substitution of a successor personal representative.
(J) In the case of a member associated with a series that is not an individual, the legal existence of the person otherwise terminates.