Background
Bridjay Capone owned a 25 percent interest in each of three family-owned LLCs that held commercial property and businesses in Stamford. In 2012, she and other family members sued, seeking among other relief dissolution and winding up of the LLCs. The trial court ultimately rejected her claims, including her dissolution request, and the Appellate Court affirmed the pertinent portions of that judgment in a prior appeal.
In 2019, the LLCs brought this action to expel Capone from her membership interests. They argued that her earlier dissolution petition automatically dissociated her under former General Statutes § 34-180 (a) (4) (D). J&G Realty also alleged that Capone improperly signed a 20-year, $1-per-month lease involving Marie’s Liquors on the LLC’s behalf. After a 2023 court trial, Judge Trial Referee Kevin Tierney entered judgment for Capone.
The Court’s Holding
The Connecticut Appellate Court affirmed. It held that the former dissociation statute’s phrase “seeking for himself” concerns an entity-member seeking reorganization, liquidation, dissolution, or similar relief affecting that entity itself. It does not make an individual LLC member lose membership merely by petitioning to dissolve the LLC of which she is a member.
The court disagreed with the trial court’s rationale that the statute required relief sought solely for the member’s own benefit, but affirmed on the proper statutory interpretation. Treating Capone’s dissolution petition as automatic dissociation would also undermine an individual member’s statutory right to seek judicial dissolution. The court further held that the finding that Capone signed the lease as a witness, rather than as an unauthorized J&G Realty signatory, was not clearly erroneous.
Key Takeaways
- An individual LLC member does not automatically dissociate by seeking judicial dissolution of the LLC.
- Former § 34-180 (a) (4) (D) protects against an entity-member’s own reorganization or dissolution, not a member’s suit against the LLC.
- A lease signature positioned separately from the contracting parties’ signature lines supported the finding that Capone signed only as a witness.
Why It Matters
The decision preserves an individual LLC member’s ability to pursue judicial dissolution without forfeiting membership and standing in the same act. It also confirms that courts may affirm a correct judgment on a ground different from the trial court’s reasoning.