South Carolina § 33-44-407 - Liability for unlawful distributions.
Full text of South Carolina South Carolina Code of Laws § 33-44-407 — Liability for unlawful distributions., with citation guidance and answers to common questions.
§ 33-44-407. Liability for unlawful distributions.
(a) A member of a member-managed company or a member or manager of a manager-managed company who votes for or assents to a distribution made in violation of Section 33-44-406, the articles of organization, or the operating agreement is personally liable to the company for the amount of the distribution which exceeds the amount that could have been distributed without violating Section 33-44-406, the articles of organization, or the operating agreement if it is established that the member or manager did not perform the member's or manager's duties in compliance with Section 33-44-409.
(b) A member of a manager-managed company who knew a distribution was made in violation of Section 33-44-406, the articles of organization, or the operating agreement is personally liable to the company, but only to the extent that the distribution received by the member exceeded the amount that could have been properly paid under Section 33-44-406.
(c) A member or manager against whom an action is brought under this section may implead in the action all:
(1) other members or managers who voted for or assented to the distribution in violation of subsection (a) and may compel contribution from them; and
(2) members who received a distribution in violation of subsection (b) and may compel contribution from the member in the amount received in violation of subsection (b).
(d) A proceeding under this section is barred unless it is commenced within two years after the distribution.
HISTORY: 1996 Act No. 343, SECTION 2.
Source: official South Carolina text · Last verified 2026-08-27
Frequently Asked Questions About South Carolina § 33-44-407
What does South Carolina Code of Laws § 33-44-407 cover?
Section 33-44-407 ("Liability for unlawful distributions.") is part of the South Carolina Code of Laws, the codified statutory law of South Carolina. It sets out the legal rule or procedure described in the text above. Statutes are amended regularly, so always verify against the official source.
How do I cite South Carolina § 33-44-407?
A common citation format is "South Carolina Code of Laws § 33-44-407" (South Carolina). Legal writing may require the code abbreviation, section number, and year or edition. Match the style required by your court, professor, or publisher.
Is this the official text of South Carolina law?
No. This page is for research and education and may not include the most recent amendments. For official current law, check the South Carolina official source linked on this page or consult a licensed South Carolina attorney.
How does South Carolina § 33-44-407 apply to my situation?
Statutes are interpreted in context, and application depends on your specific facts. Only a licensed attorney in South Carolina can advise on how this section applies to you. Contact your state or local bar association for a referral.
Sources & Verification
Not legal advice. Verify against the official source and consult a licensed attorney in South Carolina.