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Neither Member Nor Manager And Yet Still An Agent Be

"Let every eye negotiate for itself
And Trust no Agent;"

In a recent ruling, U.S. Magistrate Judge Kimberly C. Priest Johnson addressed the question of who may be an agent of a California limited liability company.  Autoficio, LLC v. Cimble Corp., 2020 U.S. Dist. LEXIS 103730.  In seeking summary judgment in the case, the defendants argued that one of the plaintiffs could not be an agent of a California LLC in which he was neither a member nor manager.  In support of this dubious proposition, the defendants cited Sections 17704.08(d)(2) and 17713.12(e)(2) of the California Corporations Code.  

Neither statute purports to be an all-purpose definition of "agent".  Section 17704.08(d)(2) defines "agent" only for purposes of that subdivision which governs mandatory indemnification of successful agents.  (As an aside, this appears to be another, of many, drafting errors in the California Revised Uniform Limited Liability Company Act.  The definition of "agent" should be applicable to the entire Section, not simply Subdivision (d).)  Section 17713.12(e)(2) defines "agent" solely for purposes of that statute which prescribes a civil penalty on a California LLC for certain actions.  Judge Johnson is unquestionably correct in her conclusion that "Neither of these statutes prohibit a California limited liability company from creating an agency relationship with someone who is not a member or manager . . .".   

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30172DBAB0084D3A8F39D7AF0A8E79BC.ashx Keith Paul Bishop
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