Public Act 096-0263
 		





HB1336 Enrolled
LRB096 10290 KTG 20460 b






    AN ACT concerning business.

 
    Be it enacted by the People of the State of Illinois,
 
represented in the General Assembly:


 
    Section 5. The Limited Liability Company Act is amended  by 
changing Section 15-3 as follows:
 



    (805 ILCS 180/15-3)



    Sec. 15-3. General standards of member and manager's 
conduct. 

    (a) The fiduciary duties a member owes to a member-managed 
company and its
other members include the duty of loyalty and 
the duty of care referred to in
subsections (b) and (c) of this 
Section.

    (b) A member's duty of loyalty to a member-managed company 
and its other
members includes the following:


        (1) to account to the company and to hold as trustee 
    for it any property,
profit, or benefit derived by the 
    member in the conduct or winding up of the
company's 
    business or derived from a use by the member of the 
    company's
property, including the appropriation of a 
    company's opportunity;


        (2) to act fairly when a member deals with the company 
    in the conduct or
winding up of the company's business as 
    or on behalf of a party having an
interest adverse to the 
    company; and


        (3) to refrain from competing with the company in the 
    conduct of the
company's business before the dissolution of 
    the company.

    (c) A member's duty of care to a member-managed company and 
its other
members in the conduct of and winding up of the 
company's business is limited to
refraining from engaging in 
grossly negligent or reckless conduct, intentional
misconduct, 
or a knowing violation of law.

    (d) A member shall discharge his or her duties to a 
member-managed company
and its other members under this Act or 
under the operating agreement and
exercise any rights 
consistent with the obligation of good faith and fair
dealing.

    (e) A member of a member-managed company does not violate a 
duty or
obligation under this Act or under the operating 
agreement merely because the
member's conduct furthers the 
member's own interest.

    (f) This Section applies to a person winding up the limited 
liability
company's business as the personal or legal 
representative of the last
surviving member as if the person 
were a member.

    (g) In a manager-managed company:


        (1) a member who is not also a manager owes no duties 
    to the company or to
the other members solely by reason of 
    being a member;


        (2) a manager is held to the same standards of conduct 
    prescribed for
members in subsections (b), (c), (d), and 
    (e) of this Section;


        (3) a member who pursuant to the operating agreement 
    exercises some or all
of the authority of a manager in the 
    management and conduct of the company's
business is held to 
    the standards of conduct in subsections (b),
(c), (d), and 
    (e) of this Section to the extent that the member exercises 
    the
managerial authority vested in a manager by this Act; 
    and


        (4) a manager is relieved of liability imposed by law 
    for violations of
the
standards prescribed by subsections

    (b), (c), (d), and (e) to the extent of the managerial 
    authority delegated to
the members by the operating 
    agreement.

(Source: P.A. 95-331, eff. 8-21-07.)