Section 17701.10 of California's Revised Uniform Limited Liability Company Act (RULLCA) provides that an operating agreement serves the following four purposes:
- Relations among the members as members and between the members and the limited liability company;
- The rights and duties under RULLCA of a person in the capacity of manager;
- The activities of the LLC and the conduct of those activities; and
- The means and conditions for amending the operating agreement.
This same statute imposes annoyingly intricate prohibitions and limitations on which provisions of the RULLCA may be altered or eliminated by an operating agreement. Section 17701.10, however, does not address whether an operating agreement may include the consent of members to the jurisdiction of another state's courts.
That question is answered by Section 17701.17(a) which provides that a member may, in a written operating agreement consent to:
- The jurisdiction of the courts of a specified jurisdictionand the courts of California; or
- The exclusive jurisdiction of the California courts.
I do not know why someone would want to elect the first option. Curiously, however, Section 17701.06, which specifies the matters governed by California law, does not mention operating agreements. It is also curious that Section 17701.10 does not prohibit the operating agreement from varying the requirements of Section 17701.17 even while providing that an operating agreement may not vary the law applicable under Section 17701.06.
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