Ark. Code Ann. » Title 4 Chapter 32
Arkansas Code Annotated

Ark. Code Ann. § 4-32-301 (2026)

Agency power of members and managers

✓ current as of May 2026
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  1. Except as provided in subsection (b) of this section, every member is an agent of the limited liability company for the purpose of its business or affairs, and the act of any member, including, but not limited to, the execution in the name of the limited liability company of any instrument, for apparently carrying on in the usual way the business or affairs of the limited liability company of which he or she is a member, binds the limited liability company, unless the member so acting has, in fact, no authority to act for the limited liability company in the particular matter, and the person with whom the member is dealing has knowledge of the fact that the member has no such authority.
  2. If the articles of organization provide that management of the limited liability company is vested in a manager or managers:
    1. No member solely by reason of being a member is an agent of the limited liability company; and
    2. Every manager is an agent of the limited liability company for the purpose of its business or affairs, and the act of any manager, including, but not limited to, the execution in the name of the limited liability company of any instrument, for apparently carrying on in the usual way the business or affairs of the limited liability company of which he or she is a manager binds the limited liability company, unless the manager so acting has, in fact, no authority to act for the limited liability company in the particular matter, and the person with whom the manager is dealing has knowledge of the fact that the manager has no such authority.
  3. An act of a manager or a member which is not apparently for the carrying on in the usual way the business or affairs of the limited liability company does not bind the limited liability company unless authorized in accordance with an operating agreement, at the time of the transaction or at any other time.
  4. No act of a manager or member in contravention of a restriction on authority shall bind the limited liability company to persons having knowledge of the restriction.

History. Acts 1993, No. 1003, § 301.

Case Notes

Liability.

In a case alleging breach of contract and breach of fiduciary duty, summary judgment was properly granted to a managing limited liability company's members and the members' respective limited liability companies since there was no privity of contract; the persons and companies at issue were not parties to the operating agreement for a water park limited liability company, and several signatures were as agents for other entities. There was no authority for the proposition that the actions of one corporation could have been imputed to another solely by their common membership and management. K.C. Props. of N.W. Ark., Inc. v. Lowell Inv. Partners, LLC, 373 Ark. 14, 280 S.W.3d 1 (2008).

Notes of Decisions
Cited in 3 cases, 2008–2013 · leading case: K.C. Props. of N.W. Arkansas, Inc. v. Lowell Inv. Partners, LLC, 280 S.W.3d 1 (Ark. 2008).
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K.C. Props. of N.W. Arkansas, Inc. v. Lowell Inv. Partners, LLC, 280 S.W.3d 1 (Ark. 2008). · cites it 5× “Appellants rely on § 4-32-301 (b)(2) (Repl. 2001) for their proposition that the term “manager” implies that there is an agency relationship and that the term “agency” need not be used to allege an agency relationship.”
McGraw v. Collier (In re Collier), 497 B.R. 877 (Bankr. E.D. Ark. 2013). · cites it 2× “Even though the LLC did not sign a Subscription Agreement, the LLC can be charged with the knowledge of information acquired by Sutter when he and his wife signed the Subscription Agreement in their individual capacities.”
Clear Sky Props., LLC v. Roussel (In re Roussel), 483 B.R. 915 (Bankr. E.D. Ark. 2012). “Pursuant to Arkansas Code Annotated § 4-32-301, “[e)very member and manager *923 must account to the limited liability company and hold as trustee for it any profit or benefit derived by that person.”
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