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Judicial Scrutiny of Fiduciary Duties in Delaware Limited Partnerships and Limited Liability Companies

32 Pages Posted: 27 Mar 2007  

Myron T. Steele

Government of the State of Delaware - Supreme Court of Delaware

Abstract

Delaware courts have tremendous experience in applying fiduciary duty principles when issues involving corporate governance arise. When the business entity involved is a limited partnership or a limited liability company, however, should the courts draw analogies from common law corporate fiduciary duty principles? In this article, Chief Justice Steele argues that parties forming limited partnerships and limited liability companies should be free to adopt or reject some or all of the fiduciary duties recognized at common law and that courts should look to the parties' agreement and apply a contractual analysis rather than analogizing to traditional notions of corporate governance. Chief Justice Steele also suggests that the application of a contractual analysis would comport with the statutory mandate expressed in the 2004 amendment to Delaware's Limited Partnership Act and would best serve the intent of the parties.

Keywords: delaware, journal, corporate, law, steele, limited partnership, limited liability companies, agreement, common law, contract

Suggested Citation

Steele, Myron T., Judicial Scrutiny of Fiduciary Duties in Delaware Limited Partnerships and Limited Liability Companies. Delaware Journal of Corporate Law, Vol. 32, No. 1, pp. 1-32, 2007. Available at SSRN: https://ssrn.com/abstract=975416

Myron Steele (Contact Author)

Government of the State of Delaware - Supreme Court of Delaware ( email )

820 N. French Street
P.O. Box 1997
Wilmington, DE 19801
United States

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