Tennessee § 48-217-101 - Personal liability.

§ 48-217-101. Personal liability.

Limited Liability Rule. Except as provided in subsections (e) and (f), a member, holder of financial interest, governor, manager, employee or other agent of an LLC does not have any personal obligation and is not otherwise personally liable for the acts, debts, liabilities, or obligations of the LLC whether such arise in contract, tort or otherwise. A member, holder of financial interest, governor, manager, employee or other agent of an LLC does not have any personal obligation and is not otherwise personally liable for the acts or omissions of any other member, manager, governor, employee or other agent of the LLC. Notwithstanding subdivisions (a)(1) and (2), a member, holder of financial interest, governor, manager, employee or other agent may become personally liable in contract, tort or otherwise by reason of such person's own acts or conduct. Limited Liability after Dissolution. The limited liability described in subsection (a) continues in full force regardless of any dissolution, winding up, and termination of an LLC. Member Not a Proper Party to Proceeding. A member, holder of financial interest, governor, or manager of an LLC is not a proper party to a proceeding by or against an LLC except: Where the object of the proceeding is to enforce such person's right against or liability to the LLC; In a derivative action brought pursuant to chapters 201-248 of this title, the articles or the operating agreement; or Where the proceeding asserts personal liability of such member, holder of financial interest, governor, or manager as described in subdivision (a)(3). Sales Tax Liability. Notwithstanding any other provision of chapters 201-248 of this title to the contrary, each person, member, or employee required to collect, truthfully account for, and pay over to the department of revenue any tax collected from the customers of an LLC shall be personally liable for such taxes in the same manner as responsible persons of a corporation under § 67-1-1443. Failure to Follow Formalities Not to Generate Personal Liability. The failure of an LLC to observe the usual company formalities or requirements relating to the exercise of its LLC powers or management of its business is not a ground for imposing personal liability on the members, governors, managers, employees or other agents of the LLC. Voluntary Unlimited Liability. Notwithstanding anything to the contrary in this section, the articles may provide that one (1) or more specifically identified members, as named in the articles, will be personally liable for all of the debts, obligations and liabilities of the LLC and, if so, each such specifically identified member shall be liable to the same extent as a general partner in a general partnership; provided, that: In order to be effective, each member so identified must sign the articles, or an amendment to the articles containing this provision; and Each such member shall continue to be personally liable for debts, obligations and liabilities of the LLC until the articles are amended to strike such member's name, but the amendment must be signed by the chief manager or secretary and any remaining members who continue to be identified in the articles as being personally liable for the debts, obligations and liabilities of the LLC. A member who is identified in the articles as being personally liable has the power, but not necessarily the right, to withdraw from the LLC by filing an amendment to the articles stating that such member has withdrawn from the LLC and will not be liable for any future debts, obligations and liabilities of the LLC; provided, that such an amendment to the articles shall be effective immediately except with respect to parties that have reasonably relied upon the articles naming such person as individually liable for the debts, obligations and liabilities of the LLC. An amendment to the articles filed pursuant to subdivisions (f)(1) and (2) is not effective against such parties reasonably relying upon such articles until the passage of ninety (90) days from the filing of the amendment to the articles. Notwithstanding the preceding, such member or former member will continue to be liable for all debts and obligations of the LLC incurred by the LLC while such member assumed liability. Acts 1994, ch. 868, § 1; 1995, ch. 403, §§ 22-24.