Chapter 4 - § 4.23 • LIMITED LIABILITY COMPANIES

• Jurisdiction: Colorado

§ 4.23 • LIMITED LIABILITY COMPANIES

§ 4.23.1—In General

A deed from a limited liability company raises the same questions as are raised in the case of a corporation: (1) whether the entity is a limited liability company in fact, (2) whether the signatory manager or member had authority to make the particular conveyance, and (3) whether the conveyance was made in the manner provided by law.

§ 4.23.2—Formation

A limited liability company may be formed for any lawful business, subject to state laws and regulations.³⁹² A limited liability company is formed when its articles of organization become effective.³⁹³ The fact that the articles of organization are on file in the office of the secretary of state is notice that the limited liability company is a limited liability company and of all other facts required to be stated in the articles of organization.³⁹⁴

§ 4.23.3—Members and Managers

If the articles of organization provide that the limited liability company is to be managed by managers, a member has no authority to bind the limited liability company solely by virtue of being a member,³⁹⁵ and an act of a manager, including the execution of an instrument in the name of the limited liability company, for apparently carrying on in the ordinary course of business of the limited liability company or business of the kind carried on by the limited liability company binds the limited liability company, unless the manager had no authority to act for the limited liability company in the particular matter and the persons with whom the manager was dealing had notice that the manager lacked authority.³⁹⁶

If the articles of organization provide that the limited liability company is to be managed by members, an act of a member, including the execution of an instrument in the name of the limited liability company, for apparently carrying on in the ordinary course of business of the limited liability company or business of the kind carried on by the limited liability company binds the limited liability company, unless the member had no authority to act for the limited liability company in the particular matter and the persons with whom the member was dealing had notice that the member lacked authority.³⁹⁷

It should be noted that:

• Unless the articles of organization are recorded in the office of the clerk and recorder, whether the management is reserved to the members will not appear of record in that office. It will appear, however, in the records of the secretary of

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