§ 7-16-32 - Liability upon wrongful distribution. - Rhode Island Statutes

SECTION 7-16-32

   § 7-16-32  Liability upon wrongfuldistribution. – (a) A member or manager who votes for or assents to a distribution in violationof the operating agreement or of § 7-16-31 is personally liable to thelimited liability company for the amount of the distribution that exceeds whatcould 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 heldliable under subsection (a) for the unlawful distribution; and

   (2) From each member for the amount the member receivedknowing that the distribution was made in violation of the operating agreementor § 7-16-31.

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