Florida LLCs, LPs,
LLLPs and LLPs
Professor Marilyn Cane
Florida Statutes Chapter 608
Florida Limited Liability Company
The Act provides default rules in the
event an operating agreement is not
prepared. Except for a few mandatory
provisions, the parties are free to
override the default rules by contract,
which is referred to by the Act as the
LLC's “operating agreement.”
Formation and Organization
To form a Florida LLC, a member or authorized
representative of the member(s) must file Articles of
Organization for the LLC with the Florida Department
The Act provides the information required to be
included in the LLC's Articles of Organization.
The name of the LLC must include the words “limited
liability company” or the abbreviation “L.L.C.” or the
designation “LLC” as the last letters of the name of
every Florida LLC.
Formation and Organization
Articles of Organization
Generally, little information is required to be included in
the LLC's Articles of Organization.
Before transacting business in a foreign state, a foreign
LLC must obtain a certificate of authority.
Formation and Organization
The Operating Agreement
An “operating agreement” is defined as written or oral
provisions that are adopted for the management and
regulation of the affairs of the LLC and that set forth
the relationships of the members, managers and
managing members and the LLC.
Although oral agreements are permitted under the Act,
a written agreement is clearly preferable.
An operating agreement is analogous to a
corporation's bylaws and shareholder agreement.
It is not filed with the Department of State.
LLCs are either manager-managed or
Unless otherwise provided in the LLC's articles
of organization or operating agreement, the
LLC is member-managed, with decisions to
be made by a majority-in-interest of the
members, based on the members'
proportionate profit interests. (DEFAULT RULE)
In a member-managed company, each
member is an agent of the LLC for the purpose
of its business and an act of a member in the
LLC's name binds the LLC.
To be a manager-managed LLC, the LLC's articles of
organization or operating agreement must provide for
management by one or more managers.
In a manager-managed LLC, each manager has equal rights in
the management and conduct of the LLC's business.
Under the Act, if there is more than one manager, any matter
relating to the LLC's business is decided by a majority of
Similar to a member-managed LLC, however, each manager is an
agent of the LLC for the purposes of its business, and an act of a
manager in the LLC's name binds the LLC.
Fiduciary Duties of Managers and
Under the Act, each manager and managing
member owes a duty of loyalty and a duty of
care to the LLC and all of its members.
The LLC's operating agreement may not
eliminate the duty of loyalty or unreasonably
reduce the duty of care.
Members of a LLC have the same
liability protection as shareholders of a
corporation. See 608.701, Florida
Florida Statutes Section 608.701 provides :
In any case in which a party seeks to hold the
members of a limited liability company personally
responsible for the liabilities or alleged improper
actions of the limited liability company, the court
shall apply the case law which interprets the
conditions and circumstances under which the
corporate veil of a corporation may be pierced
under the law of this state.
See Dania case, “improper conduct” standard
Transferability and Assignment of
Under the Act, the membership interests of a LLC are
freely assignable in whole or in part. However unless
the assignee is admitted as a substitute member, only
economic rights with respect to the assigned
membership interests are transferred.
An assignee of membership interests is not admitted
as member until all other members consent to the
assignee's admission as a member. The LLC's articles
of organization or operating agreement may provide
that less than unanimous consent is required to admit
new members (such as manager approval).
Transferability and Assignment
of Member Interest
An assignee not admitted as a member is not entitled
to vote or participate in managing the LLC.
Typically an assignee will want to be admitted as a
member, and documentation prepared in connection
with the transfer of the membership interests should
make clear the assignee's admission as a member and
required consents should be secured.
Limited Liability Limited
The name of a limited partnership must
contain the phrase “limited partnership” or
“limited” or the abbreviation “L.P.” or “Ltd.” or
the designation “LP”
The name of a limited liability limited
partnership must contain the phrase “limited
liability limited partnership” or the
abbreviation “L.L.L.P.” or designation “LLLP”
LP and LLLP Liability of
the General Partners
In a Limited Partnership (LP) all general partners are liable
jointly and severally for all obligations of the limited
partnership unless otherwise agreed by the claimant or
provided by law.
In a Limited Liability Limited Partnership (LLLP) an obligation
of a limited partnership incurred while the limited partnership is a
limited liability limited partnership, whether arising in contract,
tort, or otherwise, is solely the obligation of the limited partnership.
A general partner is not personally liable, directly or indirectly, by
way of contribution or otherwise, for such an obligation solely by
reason of being or acting as a general partner.
In a General Partnership all partners are liable jointly
and severally for all obligations of the partnership
unless otherwise agreed by a claimant or provided by
In a Limited Liability Partnership (LLP) an obligation
of a partnership incurred while the partnership is a
limited liability partnership, whether arising in
contract, tort, or otherwise, is solely the obligation of
the partnership. A partner is not personally liable,
directly or indirectly, by way of contribution or
otherwise, for such an obligation solely by reason of
being or so acting as a partner.
The name of a limited liability
partnership must end with “Registered
Limited Liability Partnership,” “Limited
Liability Partnership,” “R.L.L.P.,”
“L.L.P.,” “RLLP,” or “LLP.”