Limited Liability Companies. Michael Collins entered into a ...

[Bernana]

Limited Liability Companies. Michael Collins entered into a three-year employment contract with E-Magine, LLC. E-Magine was in business for only a brief time, during which it incurred considerable losses. In terminating operations, which ceased before the term of the contract with Collins expired, E-Magine also terminated Collins's services. In exchange for a payment of 24,240, Collins signed a final payment agreement, which purported to be a settlement of any claims that he might have against E-Magine. Collins filed a suit in a New York state court against E-Magine, its members and managers, and others, alleging, among other things, breach of his employment contract. Collins claimed that signing the final payment agreement was the only means for him to obtain what he was owed for past sales commissions and asked the court to impose personal liability on the members and managers of E-Magine for breach of contract. Should the court grant this request? Why or why not?

Question 2

An undisclosed principal is a principal whose identity is unknown to the third party with whom the agent is involved.
 a. True
  b. False
  Indicate whether the statement is true or false

[BUTTHOL369]

Answer to Question 1

Limited liability companies
The court issued a summary judgment in favor of the defendants, and Collins appealed to a state intermediate appellate court, which affirmed the lower court's judgment. The appellate court acknowledged that E-Magine does appear to have breached the three-year employment contract between it and Michael Collins when it terminated plaintiff's services, but interpreted the final payment agreement as a release and not, as Collins contended, a receipt. As for the members and managers' liability, the court explained that under the state's limited liability company statutes, the defendants, as members and managers of E-Magine, a limited liability company under New York's Limited Liability Company Law, are expressly exempt from personal responsibility for the obligations of E-Magine.

Answer to Question 2

TRUE

[Bernana]

YES! Correct, THANKS for helping me on my review

[Sarahjh]

Thanks for the timely response, appreciate it