Wohrman v. Rogers

ORS 63.165 grants limited immunity from personal liability to members of an LLC for obligations undertaken by the LLC, even where the LLC is administratively dissolved and the obligation does not arise from business activities to wind up or liquidate the LLC's business.

Plaintiff appealed the trial court’s decision holding that Defendant is not personally liable for a loan obligation, arguing that ORS 63.165 should not apply after dissolution of a limited liability corporation (LLC), and that LLC members should be held personally liable for post-dissolution obligations undertaken by the LLC. Defendant held a one-third share in an Oregon LLC: JJR. JJR was administratively dissolved in April 2004, which prohibited JJR from carrying on any business except as required to wind up and liquidate its business and affairs. In 2008, Defendant took out a loan from Plaintiff for $52,000, and signed JJR as liable for the promissory note. Payments on the loan stopped, and Plaintiff sued Defendant personally for breach of contract. The trial court found that, under ORS 63.165, members of a legally dissolved LLC cannot be held personally liable for the LLC’s obligations. On appeal, Plaintiff argued that ORS 63.165 should not apply to protect members of a legally dissolved LLC when a cause of action arises out of actions not taken to wind up or liquidate the business. The Court reviewed the text, context, and legislative history of ORS 63.165, and held that the limited immunity conferred to members of an LLC extends to post-dissolution proceedings of the LLC. Affirmed.