Many Arizona business owners choose the limited liability company (LLC) structure for their business, primarily due to its ease of creation and operation and low costs. Forming and operating a corporation, for instance, is significantly more time-consuming and expensive than forming and operating an LLC. The recordkeeping requirements to maintain a corporation are also significantly greater. LLCs are flexible, in that they can be tailored to the specific needs of the owners or members, while offering tax protection and insulation from personal liability.
Despite these advantages, an LLC is not a structure that will make your business immune from litigation. In fact, litigation often comes from within. For example, the terms of your LLC’s operating agreement determine who has decision-making powers. Your LLC may be managed directly by the members; more commonly, the members of your LLC may delegate general managerial authority to one or more managers. In this type of LLC, the members reserve the right to make major decisions for the LLC, such as changing provisions in the operating agreement. When members who manage their LLC disagree on a major issue relating to the business, or when a member disagrees with how a manager is running the business, litigation can result.
While the LLC is a business entity that can provide many legal protections, structuring your business entity as an LLC will not necessarily insulate you from legal disputes over contracts and employees, or from members who disagree on business operations. When you are facing any type of business dispute, you need an experienced Arizona business attorney who can both advise you on the issues and advocate for your interests from the outset. We are here to examine the facts concerning your dispute, consider your options, and build the strongest case possible. Contact Williams Mestaz, L.L.P., at (602) 256-9400 to schedule an appointment about your case.