AB 683: Business entities: limited liability companies.

Existing law, the California Revised Uniform Limited Liability Company Act, establishes procedures governing the formation and regulation of limited liability companies in this state. Existing law requires a limited liability company (LLC) to file certain information, including its articles of organization and amendments to those articles, with the Secretary of State.

This bill would authorize an LLC to present a certification of the LLCs existence and authority to any person a licensed escrow agent, licensed real estate broker, and title insurance company or underwritten title company to establish the present existence of the LLC and identify those with authority to act on its behalf. The bill would require the certification of LLC existence to confirm specified facts or contain certain information, including that its operating agreement or other governing documents have not been revoked, modified, or amended in a manner that would cause the representations contained in it to be incorrect. The bill would require the certification to be in the form of an acknowledged declaration signed by all authorized signers of the LLC and would permit the certification to be recorded with the county recorder, as specified.

This bill would authorize a person whose interests may be affected by the LLCs certification to rely on the representations in the certification. The bill would further provide that a person who acts in reliance upon a certification without actual knowledge that the representations contained in it are incorrect is not liable to any person for so acting. The bill would provide that any transaction and lien created thereby, entered into by the LLCs authorized signer and a person acting in reliance upon a certification and authority, shall be enforceable against the LLCs assets, except as specified.

This bill would also authorize a person to record a certification of LLC existence and authority that relates to an interest in real property in the county recorder in any county in which the real property is located. The bill would require the county recorder to impose a fee prescribed by law for recording that document sufficient to cover its reasonable costs. Because the bill would expand the crime of perjury and impose a new duty on county recorders, the bill would create a state-mandated local program.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for specified reasons.