Cralle Comer and Stephen Chapman form two manager-managed limited liability companies, Garrison-Ashburn LC and Garrison-Woods LC. Comer
Question:
Cralle Comer and Stephen Chapman form two manager-managed limited liability companies, Garrison-Ashburn LC and Garrison-Woods LC. Comer and Chapman each own a 50 percent membership interest in each LLC. Comer is the operating manager. Chapman files a voluntary petition in bankruptcy under Chapter 11 of the U.S. Bankruptcy Code. In the course of the bankruptcy proceeding, Comer wishes to sell a parcel of land owned by GarrisonWoods. Chapman argues that Garrison-Woods cannot sell the land without his consent on the grounds that the LLC’s operating agreement requires both members to execute all deeds and sale contracts. Chapman refuses to sign the contract of sale or the deed. Comer argues that as operating manager, he is fully authorized to execute the contract. Do you think the court will find in favor of Comer or Chapman?
Step by Step Answer:
Business Law The Ethical Global and E-Commerce Environment
ISBN: 978-1259917110
17th edition
Authors: Arlen Langvardt, A. James Barnes, Jamie Darin Prenkert, Martin A. McCrory