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No Unforced Errors Please: “For Cause” Removal Provisions Mean What They Say and Say What They Mean

Not long ago, we wrote about the vital need for strict compliance with contractual options to buy or sell closely-held business equity interests. As we noted then, failure to strictly comply with any contractual conditions...more

New Year, New Law – New Opacity – for LLC Owner Disputes

New York’s appellate courts are breaking new ground in 2025. Until a month ago, I would have said that “deadlock” most certainly is not enough on its own to dissolve a New York LLC....more

Is an LLC Bound by its Own Operating Agreement?

Is a limited liability company a party to and bound by its own operating agreement? Many folks would say, “Yes, of course.” But it turns out the answer varies depending upon the law of the company’s state of...more

Dollars, Donuts, and Buy-Sell Options

Buy-sell agreements come in all shapes and sizes. Some are straightforward. Others are outrageously complex, especially purchase price formulas. Some have triggers for death. Others disability. Retirement. Expulsion....more

Business Divorce and Restrictive Covenants

Closely-held business owner breakups often defy easy categorization. What seem at first blush to be traditional business divorce cases sometimes end up treading far into other legal practice areas. Other disputes blur...more

The “Illegality” Defense to Partnership Formation

Food trucks have become as ubiquitous on the streets of Manhattan as pigeons in Central Park. Unsurprisingly, the New York City food truck business is highly regulated, requiring licensure of those participating in the...more

The Contract is King: Advancement and Indemnification Under Delaware Law

In last week’s New York Business Divorce, we wrote about an important decision from New York’s highest court, Sage Sys., Inc. v Liss (___ NY3d ___, 2022 NY Slip Op 05918 [Ct App Oct. 20, 2022]). In Sage, the Court of Appeals...more

Warning: If You Want Legal Fee Advancement or Indemnification, You May Need to Amend Your Partnership, Shareholder, or Operating...

The universe works in mysterious ways. Four days ago, when I sat down to write this article, my plan was to feature a decision from Manhattan Commercial Division Justice Andrea J. Masley denying dismissal of a closely-held...more

Anti-Dissolution Provisions and Public Policy

In Congel v Malfitano, New York’s highest court wrote that business partners are free to include in partnership contracts practically “any agreement they wish,” including about “the means by which a partnership will dissolve,...more

Cooked or Raw? Enforceability of Partly Signed Operating Agreements

The harried realities of modern life are such that business entity organizational documents, like LLC operating agreements, sometimes do not get drafted or executed until long after the entity’s initial formation with the...more

A Bumper Crop: Cannabis Meets Business Divorce

Unless you’ve been living under a rock, you’ve probably heard that a little over two months ago, New York State Governor Andrew M. Cuomo signed legislation reform advocates and stoners alike have dreamt of for decades,...more

Unsigned, Non-Final Operating Agreemeent Trumps Conflicting Testamentary Bequest of LLC Interest

Ten months ago, we wrote about an unusual case involving an LLC member who documented two irreconcilable membership interest transfers upon death. In Harris v Harris, 2020 NY Slip Op 31570(U) [Sup Ct, NY County Apr. 23,...more

When Estate Plans and Stock Transfer Restrictions Collide

A recent decision from Bronx County Supreme Court Justice Llinet M. Rosado, Sebrow v Sebrow, 2020 NY Slip Op 20269 [Sup Ct, Bronx County Oct. 9, 2020], is a stark reminder to corporate shareholders, attorneys who plan their...more

Enforceability of Oral Operating, Shareholder, and Partnership Agreements

Oral agreements – and oral modifications of written agreements – are a constant source of litigation in business divorce cases. Alleged oral agreements are subject to attack based upon legal enforceability – as well as their...more

How to Resolve Competing Estate Plans of an LLC Owner with a Double Life

Corporate shareholder and LLC operating agreements routinely contain provisions addressing the transfer of equity interests upon the death of an owner of a closely-held business. Such provisions are vital for succession...more

WIll the Pandemic Be a Boon for Future LLC Dissolution Claimants?

The ongoing coronavirus / COVID-19 pandemic has quite literally impacted everyone and everything in New York, including the courts, which were forced to temporarily cease non-essential functions. The result was a short-lived...more

Can an Arbitrator Order Extra-Judicial Dissolution?

Often business owners enter into arbitration agreements because they hope it will result in a speedier, less expensive resolution than litigation to disputes with their co-owners. ...more

Delaware Contractarian Principles Prevail in Appeal Over Deceased Ace Hotel Founder’s LLC Interest

The sudden death of Alexander Calderwood, the brilliant but troubled co-founder of the Ace brand of hotels, resulted in some fierce litigation between Calderwood’s estate and Calderwood’s LLC co-member over the nature of his...more

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