TITLE 7
Corporations, Associations, and Partnerships

CHAPTER 7-16
The Rhode Island Limited Liability Company Act

SECTION 7-16-32


§ 7-16-32 Liability upon wrongful distribution.

(a) A member or manager who votes for or assents to a distribution in violation of the operating agreement or of § 7-16-31 is personally liable to the limited liability company for the amount of the distribution that exceeds what could have been distributed without violating the operating agreement or § 7-16-31.

(b) Each member or manager held liable under subsection (a) for an unlawful distribution is entitled to contribution:

(1) From each other member or manager who could be held liable under subsection (a) for the unlawful distribution; and

(2) From each member for the amount the member received knowing that the distribution was made in violation of the operating agreement or § 7-16-31.

(c) A proceeding under this section is barred unless it is commenced within two (2) years after the date on which the effect of the distribution is measured under § 7-16-31.

History of Section.
(P.L. 1992, ch. 280, § 1.)