Delaware Business Litigation Report

Superior Court Dismisses Case Against Member of Limited Liability Company, Finding that Member Was Not Liable for the Actions of the Limited Liability Company

Thomas v. Hobbs, C.A. No. 04C-02-010 RFS, 2005 WL 1653947 (Del. Super. Ct. Apr. 27, 2005). The Plaintiff brought an action for breach of contract against the defendant limited liability company and against the sole member of that defendant limited liability company personally. The member moved for summary judgment, arguing that she could not be held personally liable for the actions of the defendant limited liability company. The court granted the defendant member's motion. In September 2002, Plaintiff William A Thomas ("Thomas") and Tara Venture, L.L.C. ("Tara Venture") entered into a contract for Tara Ventured to complete a "fit out" to construct the interior of Thomas' office. When Tara Venture failed to complete the work, Thomas paid another company to complete the work and sued Tara Venture and Tara Venture's sole member, Debra Hobbs. Hobbs moved for summary judgment, arguing that she could not be held personally liable. Agreeing with Hobbs' argument, the court determined that a member of a limited liability company may not normally be held liable for the acts of the company. Furthermore, the court determined that Hobbs' acts did not qualify for either exception to this rule. First, she signed the contract on the company's behalf rather than her behalf. Second, there was no evidence of a limited liability agreement in which Hobbs agreed to be obligated personally for the company's debts. Accordingly, the court granted Hobbs' motion for summary judgment. Authored by: Jason C. Jowers 302-888-6860 jjowers@morrisjames.com Share