LLC Contract and Check Signing Limits

I offer LLC owner/members the opportunity to put limits on their own and each other’s signing power on LLC contracts and LLC checks. If they decide to do so, the limits are stated in the LLC Operating Agreement and the limits are in terms of maximum dollar amount, who, and how many signatures shall be required.

I ask clients their preferences on this matter in the Pre-Organization Questionnaire Letter. When I organized “Form” LLCs a provision on this subject was not in the “forms” I used.

Sometimes clients ask that this provision not be included and sometimes they have to take some time to think it out. In either case, any business planning that my LLC organization promotes is good for business.

“It will not do for a man to enter into a contract and, when called upon to respond to its obligation, to say that he did not read it when he signed it, or did not know what it contained. If this were permitted, contracts would not be worth the paper on which they are written.” Justice Ward Hunt, Upton v. Tribilcock, 91 U.S. (1 Otto) 45, 50 (1875).