Full text of Utah Utah Code § 16-20-502 — Transfer of transferable interest. (Effective 10/1/2026), with citation guidance and answers to common questions.
§ 16-20-502. Transfer of transferable interest. (Effective 10/1/2026)
Effective 10/1/2026
16-20-502.
Transfer of transferable interest.
| (1) | Subject to Subsection 16-20-503(6), a transfer, in whole or in part, of a transferable interest:
| (b) | does not by itself cause a member's dissociation or a dissolution and winding up of the limited liability company's activities and affairs; and |
| (c) | subject to Section 16-20-504, does not entitle the transferee to:
| (i) | participate in the management or conduct of the limited liability company's activities and affairs; or |
| (ii) | except as otherwise provided in Subsection (3), have access to records or other information concerning the limited liability company's activities and affairs. |
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| (2) | A transferee has the right to receive, in accordance with the transfer, distributions to which the transferor would otherwise be entitled. |
| (3) | In a dissolution and winding up of a limited liability company, a transferee is entitled to an account of the limited liability company's transactions only from the date of dissolution. |
| (4) | A transferable interest may be evidenced by a certificate of the interest issued by the limited liability company in a record, and, subject to this section, the interest represented by the certificate may be transferred by a transfer of the certificate. |
| (5) | A limited liability company need not give effect to a transferee's rights under this section until the limited liability company knows or has notice of the transfer. |
| (6) | A transfer of a transferable interest in violation of a restriction on transfer contained in the operating agreement is ineffective as to a person having knowledge or notice of the restriction at the time of transfer. |
| (7) | Except as otherwise provided in Subsection 16-20-602(5)(b), if a member transfers a transferable interest, the transferor retains the rights of a member other than the transferable interest transferred and retains all the duties and obligations of a member. |
| (8) | If a member transfers a transferable interest to a person that becomes a member with respect to the transferred interest, the transferee is liable for the member's obligations under Section 16-20-403 and Subsection 16-20-406(3) known to the transferee when the transferee becomes a member. |
Renumbered and Amended by Chapter
93, 2026 General Session
Frequently Asked Questions About Utah § 16-20-502
What does Utah Code § 16-20-502 cover?
Section 16-20-502 ("Transfer of transferable interest. (Effective 10/1/2026)") is part of the Utah Code, the codified statutory law of Utah. 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 Utah § 16-20-502?
A common citation format is "Utah Code § 16-20-502" (Utah). 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 Utah law?
No. This page is for research and education and may not include the most recent amendments. For official current law, check the Utah official source linked on this page or consult a licensed Utah attorney.
How does Utah § 16-20-502 apply to my situation?
Statutes are interpreted in context, and application depends on your specific facts. Only a licensed attorney in Utah can advise on how this section applies to you. Contact your state or local bar association for a referral.
