White v. Longley

JUSTICE RICE,

concurring.

¶54 I concur with the Court’s holding on all issues and believe the Court has correctly applied the statutes governing limited liability companies under Issue Three. Extensive testimony and materials were provided to the legislative committees which considered the LLC business form and ultimately enacted authorizing legislation during the 1993 Legislative Session. Law professor Steven Bahls testified that ‘tojwners of limited liability companies, like corporate shareholders, are generally not liable for the debts of the limited liability company.... Exceptions include when owners guarantee debts of a LLC or when owners personally commit wrongs while acting for an LLC.... For both of these exceptions, owners will be personally liable for the debts or damages.”Mont. Sen. Jud. Comm., Hearing on Sen. Bill 146, Exhibit 3, 53rd Legis., Reg. Sess. 3-4 (January 21, 1993) (emphasis added) (testimony of Steven Bahls, Associate Dean and Professor, University of Montana School of Law). Presciently, he also provided an example involving the same factual scenario at issue in the case before us: Mont. Sen. Jud. Comm., Hearing on Sen. Bill 146, Exhibit 3 at 6 (emphasis added); accord Mont. Sen. Jud. Comm., Hearing on Sen. Bill 146, Exhibit 5,53rd Legis., Reg. Sess. 7 (January 21,1993) (Executive Summary, Questions and Answers About Limited Liability Companies). Further, other courts examining this issue have reached the same conclusion. See People v. Pac. Landmark, LLC, 129 Cal. App. 4th 1203, 1213, 29 Cal. Rptr. 3d 193, 199 (2d Dist. 2005) (“we hold that whereas managers of limited liability companies may not be held liable for the wrongful conduct of the companies merely because of the managers’ status, they may nonetheless be held accountable ... for their personal participation in tortious or criminal conduct, even when performing their duties as manager” (emphasis in original)).

For example, assume a construction company has become a limited liability company. Assume that the LLC was negligent in its design and erection of a building. The LLC, itself and those who participated in the design or construction are responsible for the negligence. But just as corporate shareholders or officers who don’t participate in the design or construction are not responsible, similarly situated members of a LLC are not responsible.

¶55 I concur.