Business Records Requests- A Member’s Demand and Company’s Response
Florida Limited Liability Companies
Business Records Requests – A Member’s Demand and Company’s Response
In this next series, we discuss the rights, duties, and obligations of members and their Florida Limited Liability Companies. Florida Statute §605, titled: Florida Revised Limited Liability Company Act (the “Act”), governs the rights and responsibilities of Florida Limited Liability Companies and their members. In this article, we drill down on a member’s statutory right to seek and inspect certain records relating to a company, and the specific types of documents a company is required to maintain and provide upon request.
First, not everyone is entitled to a peek behind the curtain of a Florida Limited Liability Company. To qualify, one must be a “member” of the Limited Liability Company relating to the records with which they seek to request. Florida Statute, §605.0102 defines a “member” as a person that has an interest in the company and is designated as a member within the company’s governing documents.
Next, for ease of compliance with these types of requests, the Act provides specific guidance regarding the types of records the company is required to maintain at its designated place of business. Florida Statute, §605.0410 provides:
(1) A limited liability company shall keep at its principal office or another location the following records:
(a) A current list of the full names and last known business, residence, or mailing addresses of each member and manager.
(b) A copy of the then-effective operating agreement, if made in a record, and all amendments thereto if made in a record.
(c) A copy of the articles of organization, articles of merger, articles of interest exchange, articles of conversion, and articles of domestication, and other documents and all amendments thereto, concerning the limited liability company which were filed with the department, together with executed copies of any powers of attorney pursuant to which any articles of organization or such other documents were executed.
(d) Copies of the limited liability company’s federal, state, and local income tax returns and reports, if any, for the 3 most recent years.
(e) Copies of the financial statements of the limited liability company, if any, for the 3 most recent years.
(f) Unless contained in an operating agreement made in a record, a record stating the amount of cash and a description and statement of the agreed value of the property or other benefits contributed and agreed to be contributed by each member, and the times at which or occurrence of events upon which additional contributions agreed to be made by each member are to be made.
Florida Statute, §605.0410(2)(a) provides “[u]pon reasonable notice, a member may inspect and copy during regular business hours, at a reasonable location specified by the company: 1. The records described [above]; and 2. Each other record maintained by the company regarding the company’s activities, affairs, financial condition, and other circumstances, to the extent the information is material to the member’s rights and duties under the operating agreement or this chapter.” The company shall also furnish “other information concerning the company’s activities, affairs, financial condition, and other circumstances, except to the extent the demand or information demanded is unreasonable or otherwise improper under the circumstances.”
As alluded to in the above paragraph, the member is required to provide the company with a written request of the records with which the member seeks to inspect. In turn, within ten (10) days of receipt of the request, the company is required to provide a response to the requesting member; noting the information that the company will provide pursuant to the records request demand and when and where the company will provide such information. Additionally, within the response, if the company is denying access to any of the requested records, the company is required to provide the reason why it is withholding the requested information from inspection.
Unless otherwise stated in the company’s documents, Florida based Limited Liability Companies have a statutory duty to provide the company’s documents to its members upon request. Members of a Florida Limited Liability Company that are interested in obtaining certain records need to provide the proper demand for the records sought. If you are a member seeking certain records or a manager of a company that has recently received a demand for record inspection and have questions regarding your rights, responsibilities and obligations, please feel free to contact us for further discussion.
 A “disassociated member”, as defined under Florida Statute, §605.0602, also has certain rights to request and inspect the records of the Florida Limited Liability Company with which it was disassociated.
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