Readers of this blog will know that I’ve been censorious of California’s Revised Uniform Limited Liability Company Act (CARULLCA), Corporations Code §§ 17701.01 – 17713.13. The Partnership and Limited Liability Companies Committee of the Business Law Section of the California State Bar recognized the flaws in CARULLCA and worked on a bill, AB 506 (Maienschein), to fix its multifarious problems.  According to the Assembly floor analysis of the bill, the problems arose because the original legislation mated California’s Beverly-Killea Limited Liability Company Act (BKLLCA) with the RULLCA:

Since the enactment of SB 323, a number of inconsistencies and conflicts have been found through the Corporations Code.  SB 323 faced challenges in carrying over provisions from BKLLCA because the statutory numbering convention was different, the organizational structure was different, and various defined terms in BKLLCA differed from the corresponding terms in the NCCUSL [National Conference of Commissioners on Uniform State Laws] version of RULLCA which this bill is addressing.

On Sunday last, Governor Brown signed AB 506 into law.  While it hard to argue against fixing a mistake laden law.  However, it is more than unfortunate that CARULLCA was enacted in its deeply flawed state.  Given the changes to be effected by AB 506, it will now be advisable to review existing operating agreements and evaluate the desirability of making conforming changes.