Nearly unanimously, the New Jersey Legislature recently passed the New Jersey Revised Uniform Limited Liability Company Act (RULLCA). While this near unanimity may lead many to assume that the RULLCA is noncontroversial, with regard to fiduciary duty it is a great departure from current law. Practitioners should be welladvised of the changes and plan accordingly. In understanding this recent development, it is helpful to first understand the history of LLC law in New Jersey.
In business entity issues, there is a longstanding judicial tradition that a New Jersey court “regards the decisions rendered by Delaware courts as a germane source of reference.” In re D’Amore, _ B.R. _ (D.N.J.Bkrpt. 2012). The Delaware Department of State has concluded that New Jersey is not alone in its affections, stating in a recent publication that Delaware attorneys often “bask in the reflected admiration that [out of state attorneys] feel for the Court of Chancery.” While that may be overstating the issue, considering Delaware’s history as the preeminent worldwide jurisdiction for the adjudication of business entity issues, New Jersey’s deference is not without merit.
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