ORS 63.155
Duties and standard of conduct


(1)

The only fiduciary duties a member owes to a member-managed limited liability company and its other members are the duty of loyalty and the duty of care set forth in subsections (2) and (3) of this section.

(2)

A member’s duty of loyalty to a member-managed limited liability company and its other members includes the following:

(a)

To account to the limited liability company and hold for it any property, profit or benefit derived by the member in the conduct and winding up of the limited liability company’s business or derived from a use by the member of limited liability company property, including the appropriation of a limited liability company opportunity;

(b)

Except as provided in subsections (5) and (6) of this section, to refrain from dealing with the limited liability company in a manner adverse to the limited liability company and to refrain from representing a person with an interest adverse to the limited liability company, in the conduct or winding up of the limited liability company’s business; and

(c)

To refrain from competing with the limited liability company in the conduct of the business of the limited liability company before the dissolution of the limited liability company.

(3)

A member’s duty of care to a member-managed limited liability company and the other members in the conduct and winding up of the business of the limited liability company is limited to refraining from engaging in grossly negligent or reckless conduct, intentional misconduct or a knowing violation of law.

(4)

A member shall discharge the duties to a member-managed limited liability company and the other members under this chapter or under any operating agreement of the limited liability company and exercise any rights consistent with the obligation of good faith and fair dealing.

(5)

A member of a member-managed limited liability company does not violate a duty or obligation under this chapter or under any operating agreement of the limited liability company merely because the member’s conduct furthers the member’s own interest.

(6)

A member of a member-managed limited liability company may lend money to or transact other business with the limited liability company, provided that any loan or transaction between the member and the limited liability company must be:

(a)

Fair to the limited liability company;

(b)

Authorized by an operating agreement; or

(c)

Authorized or ratified by a majority of the disinterested members or by a number or percentage of members specified in the operating agreement after full disclosure of all material facts.

(7)

Loans and other transactions between a member-managed limited liability company and a member are binding on the parties in the same manner as transactions between the limited liability company and persons who are not members, subject to other applicable law.

(8)

This section also applies to a person who is not a member and who is winding up the limited liability company’s business.

(9)

In a manager-managed limited liability company:

(a)

A member who is not also a manager owes no duties to the limited liability company or the other members solely by reason of being a member;

(b)

A manager is held to the same standards of conduct prescribed for members in subsections (2) to (8) of this section;

(c)

A member who, pursuant to an operating agreement, exercises some or all of the rights of a manager in the management and conduct of the limited liability company’s business is held to the standards of conduct described in subsections (2) to (8) of this section to the extent that the member exercises the managerial authority vested in a manager by this chapter; and

(d)

A manager is relieved of liability imposed by law for violation of the standards prescribed by this section to the extent, if any, of the managerial authority delegated to the members who are not also managers by an operating agreement.

(10)

The articles of organization or an operating agreement of a limited liability company may not:

(a)

Eliminate completely the duty of loyalty under subsection (2) of this section, but the articles of organization or an operating agreement may:

(A)

Identify specific types or categories of activities that do not violate the duty of loyalty, if not unconscionable; and

(B)

Specify the number or percentage of members, whether interested or disinterested, or disinterested managers that may authorize or ratify, after full disclosure of all material facts, a specific act or transaction that otherwise would violate the duty of loyalty.

(b)

Unreasonably reduce the duty of care under subsection (3) of this section.

(c)

Eliminate completely the obligation of good faith and fair dealing under subsection (4) of this section, but the articles of organization or an operating agreement may determine the standards by which performance of the obligation of good faith and fair dealing is to be measured, if the standards are not unconscionable.

(11)

For the purposes of subsection (10)(a) of this section, specific types or categories of activities that may be identified as not violating the duty of loyalty include, but are not limited to:

(a)

Competing with the limited liability company in the conduct of the business of the limited liability company before the dissolution of the limited liability company; and

(b)

Entering into or engaging in, for a member’s own account, an investment, business, transaction or activity that is similar to the investments, businesses, transactions or activities of the limited liability company without:

(A)

First offering the limited liability company or the other members an opportunity to participate in the investment, business, transaction or activity; or

(B)

Having any obligation to account to the limited liability company or the other members for the investment, business, transaction or activity or the profits from the investment, business, transaction or activity. [1993 c.173 §33; 1999 c.86 §8; 2001 c.315 §23]

Source: Section 63.155 — Duties and standard of conduct, https://www.­oregonlegislature.­gov/bills_laws/ors/ors063.­html.

63.001
Definitions
63.002
Inclusion of limited liability companies and managers and members of limited liability companies in definitions
63.004
Filing requirements
63.007
Filing, service, copying and certification fees
63.011
Effective time and date of document
63.014
Correcting filed document
63.016
Forms
63.017
Filing duty of Secretary of State
63.021
Appeal from Secretary of State’s refusal to file document
63.024
Evidentiary effect of copy of filed document
63.027
Certificate of existence or authorization
63.031
Powers
63.032
Investigations of violations of chapter
63.034
Knowledge and notice
63.044
Formation
63.047
Articles of organization
63.051
Organization
63.054
Liability for preorganization transactions
63.057
Operating agreements
63.074
Purposes
63.077
General powers
63.094
Limited liability company name
63.097
Reserved name
63.101
Registered name
63.111
Registered office and registered agent
63.114
Change of registered office or registered agent
63.117
Resignation of registered agent
63.121
Service on limited liability company
63.130
Rights of members and managers
63.140
Agency power of managers and members
63.155
Duties and standard of conduct
63.160
Limitation of liability and indemnification
63.165
Liability of members and managers
63.170
Liability of limited liability company for acts, omissions or conduct of member or manager
63.175
Contributions
63.180
Liability for contributions
63.185
Allocation of profits and losses
63.195
Allocation of interim distributions
63.200
Right to interim distributions
63.205
Voluntary withdrawal of member
63.209
Expulsion of member
63.219
Distribution in kind
63.225
Right to distribution
63.229
Limitations on distribution
63.235
Liability for wrongful distribution
63.239
Nature of membership interest
63.245
Admission of members
63.249
Assignment of membership interest
63.255
Rights of assignee who becomes member
63.259
Rights of judgment creditor against member
63.265
Cessation of membership
63.431
Operating agreement
63.434
Amendment to articles of organization
63.437
Restated articles of organization
63.441
Amendment by managers
63.444
Amendment by members
63.467
Definitions for ORS 63.467 to 63.497
63.470
Conversion
63.473
Action on plan of conversion
63.476
Articles and plan of conversion
63.479
Effect of conversion
63.481
Merger
63.487
Action on plan of merger
63.494
Articles and plan of merger
63.497
Effect of merger
63.621
Dissolution
63.625
Distribution of assets upon dissolution
63.629
Agency power of members and managers after dissolution
63.631
Articles of dissolution
63.637
Effect of dissolution
63.641
Known claims against dissolved limited liability company
63.644
Unknown claims against dissolved limited liability company
63.645
Enforcement of claims against dissolved limited liability company
63.647
Grounds for administrative dissolution
63.651
Procedure
63.654
Reinstatement following administrative dissolution
63.657
Appeal from denial of reinstatement
63.661
Grounds for judicial dissolution
63.664
Procedure for judicial dissolution
63.671
Judgment of dissolution
63.674
Deposit with State Treasurer
63.701
Authority to transact business required
63.704
Consequences of transacting business without authority
63.707
Application for authority to transact business
63.711
Amendment to application for authority
63.714
Effect of authority
63.717
Name of foreign limited liability company
63.721
Registered office and registered agent of foreign limited liability company
63.724
Change of registered office or registered agent of foreign limited liability company
63.727
Resignation of registered agent of a foreign limited liability company
63.731
Service on a foreign limited liability company
63.734
Withdrawal of foreign limited liability company
63.737
Grounds for revocation
63.741
Procedure for and effect of revocation
63.744
Appeal from revocation
63.747
Reinstatement of authority
63.771
Limited liability company records
63.777
Scope of inspection right
63.781
Court-ordered inspection
63.784
Certain expense reports to members
63.787
Annual report
63.801
Derivative proceedings
63.810
Taxation of limited liability companies and members
63.951
Short title
63.955
Interstate application
63.960
Applicability of chapter to practice of dentistry
63.965
Reservation of power to amend or repeal
63.990
Penalty for signing false document
63.992
Liability for certain actions in connection with operation of shell entity
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