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Delaware Supreme Court Clarifies When LLC Agreement Makes A Contract Void

Posted In LLC Agreements

CompoSecure LLC v. Cardux LLC, C.A. No. 177,2018 (Del. November 7, 2018)

This is an important decision because it holds that an LLC agreement may make a contract void for failure to comply with the required provisions in the LLC agreement to enter into such a contract. If the contract is “void” it cannot be later ratified by implication when the parties follow the terms of the contract. Thus, when contracting with an LLC, it is necessary to read the actual LLC agreement to see if it requires any conditions to entering into a contract.