Eligible Members, Transfers, Etc

Tenn. Code Ann. tit. 48, ch. 248, pt. 4

in effect

Tenn. Code Ann. § 48-248-401 Eligible members.

48-248-401. Eligible members. (a) A PLLC may have persons not licensed to practice a profession described in the PLLC's articles in Tennessee as members only if the licensing authority which licenses the professionals forming such PLLCs specifically so authorizes. If permitted by the authority which licenses such professionals and if such professionals form PLLCs, such PLLCs may have as members only the following: (1) Individuals who are authorized by law in this or another state to render a professional service described in the PLLC's articles; (2) General partnerships in which all the partners are qualified persons with respect to the PLLC and in which at least one (1) partner is authorized by law in this state to render a professional service described in the PLLC's articles; (3) Professional corporations, domestic or foreign, authorized by law in this state to render a professional service described in the PLLC's articles; and/or (4) PLLCs, domestic or foreign, authorized by law in this state to render a professional service described in the PLLC's articles. (b) If a licensing authority with jurisdiction over a profession considers it necessary to prevent violation of the ethical standards of the profession, the authority may by rule restrict or condition, or revoke in part, the authority of PLLCs subject to its jurisdiction to have the members described in subsection (a). A rule promulgated under this section does not, of itself, make a member of a PLLC at the time the rule becomes effective a disqualified person. (c) The membership interest purported to be held by a person in violation of this section or a rule promulgated under this section is void. (d)(1) Notwithstanding any other provision of this chapter, the following health care professionals shall have a right to form and become members of the same professional limited liability company formed pursuant to this chapter: (A) Optometrists licensed under title 63, chapter 8, and ophthalmologists licensed under title 63, chapter 6 or 9; (B) Podiatrists licensed under title 63, chapter 3, and physicians licensed under title 63, chapter 6 or 9, except radiologists, pathologists, or anesthesiologists; (C) Doctors of chiropractic licensed under title 63, chapter 4, and physicians licensed under title 63, chapter 6 or 9, except radiologists, pathologists, and anesthesiologists; and (D) Physician assistants licensed under title 63, chapter 19, part 1, and physicians licensed under title 63, chapter 6 or 9, except radiologists, pathologists, and anesthesiologists. (2) The services rendered by these health care professionals are considered related and complementary to each other; provided, that nothing in this chapter shall be construed to alter the lawful scope of practice of a professional forming a professional limited liability company pursuant to this subsection (d); and further provided that nothing in this chapter shall be construed to allow any professional forming a professional limited liability company pursuant to this subsection (d) to conduct the professional's practice in a manner contrary to the standards of ethics applicable to the profession. Such individual shall accurately state the individual's professional credentials on any advertisement to the public. Acts 1994, ch. 868, § 1; 1995, ch. 403, § 92; 2002, ch. 742, § 2; 2003, ch. 45, § 2; 2005, ch. 59, § 2.

Tenn. Code Ann. § 48-248-402 Transfers.

48-248-402. Transfers. (a) Subject to §§ 48-218-101 and 48-218-102, a member of a PLLC may transfer, assign or pledge such member's financial rights, governance rights, or membership interest in the PLLC only to individuals, general partnerships, professional corporations, and other PLLCs qualified under § 48-248-401; provided, that nothing in this section shall be construed as prohibiting such a member from pledging the financial rights of that member's membership interest to a financial institution as collateral for a loan. (b) A transfer, assignment or pledge of the financial rights, governance rights or membership interests made in violation of subsection (a), except one made by operation of law or court judgment, is void. Acts 1994, ch. 868, § 1.

Tenn. Code Ann. § 48-248-403 Disqualification of members.

48-248-403. Disqualification of members. If any member of a PLLC becomes disqualified to render those professional services for which it was formed within the state, such member shall be deemed to have resigned and wrongfully withdrawn from the PLLC and shall have no further interests as a member in the PLLC other than the right to receive any distribution to which such member may be entitled under the articles or an operating agreement or § 48-216-101(d). If any member, manager, agent or employee of a PLLC organized under this chapter who has been rendering professional service to the public becomes legally disqualified to render those professional services within this state, that member, manager, agent or employee shall immediately sever all professional employment and professional relationships with, and financial interests in, that PLLC. A PLLC's failure to require compliance with this provision shall constitute a ground for the forfeiture of its articles and its dissolution by the secretary of state or, in the case of a foreign professional PLLC, for the revocation of its certificate of authority in this state. Acts 1994, ch. 868, § 1; 1995, ch. 403, § 93.

Tenn. Code Ann. § 48-248-404 Managers.

48-248-404. Managers. If persons other than qualified persons are permitted by the licensing authority to serve as governors, if any, or managers of a PLLC, not less than one half (½) of the governors, if any, and all managers except the secretary and treasurer, if any, of a PLLC shall be qualified persons with respect to the PLLC. Acts 1994, ch. 868, § 1.

Tenn. Code Ann. § 48-248-405 Privilege.

48-248-405. Privilege. A privilege applicable to communications between an individual rendering professional services and the person receiving the services recognized under the statutes or common law of this state is not affected by this chapter. The privilege applies to a domestic or foreign PLLC and to its members and employees in all situations in which it applies to communications between an individual rendering professional services on behalf of the PLLC and the person receiving the services. Acts 1994, ch. 868, § 1.

Tenn. Code Ann. § 48-248-406 Liability.

48-248-406. Liability. (a) Each individual who renders professional services as a member, holder of financial interest, governor, manager, employee or other agent of a domestic or foreign PLLC is liable for such person's own negligent or wrongful acts or omissions to the same extent as if the person rendered the services as a sole practitioner. A member, holder of financial interest, governor, manager, employee or other agent of a domestic or foreign PLLC is not liable, however, for the conduct of other members, holders of financial interests, governors, managers, employees or agents of the PLLC unless such person is also at fault. (b) A domestic or foreign PLLC whose members, governors, managers, employees or other agents perform professional services within the scope of their employment or of their apparent authority to act for the PLLC is liable to the same extent as such members, governors, managers, employees or other agents. (c) Except as otherwise provided by this chapter, the personal liability of a member, holder of financial interests, governor, manager, employee or other agent of a domestic or foreign PLLC is no greater in any respect than the liability of a member, holder of financial interests, governor, manager, employee or other agent of an LLC organized under chapters 201-248 of this title. Acts 1994, ch. 868, § 1.

Tenn. Code Ann. § 48-248-407 Mergers.

48-248-407. Mergers. (a) A PLLC may merge with or into any other business entity permitted to render the professional services of the PLLC in this state in the same manner and to the same extent as LLCs under chapter 244, part 1 of this title. (b) If the surviving business entity is an LLC and is to render professional services in this state, it must comply with this chapter. Acts 1994, ch. 868, § 1.

Tenn. Code Ann. § 48-248-408 Cessation of professional services.

48-248-408. Cessation of professional services. If a PLLC ceases to render professional services, it must amend or restate its articles to delete references to rendering professional services and to conform its name to the requirements of chapters 207 and 246 of this title. After the amendment becomes effective, the PLLC may continue in existence as an LLC under chapters 201-248 of this title and it is no longer subject to this chapter. Acts 1994, ch. 868, § 1.

Tenn. Code Ann. § 48-248-409 Dissolution.

48-248-409. Dissolution. The attorney general and reporter may commence a proceeding under § 48-245-902 to dissolve a PLLC if: (1) The secretary of state or a licensing authority with jurisdiction over a professional service described in the PLLC's articles serves written notice on the PLLC in accordance with § 48-208-104, that it has violated or is violating a provision of this chapter; (2) The PLLC does not correct each alleged violation, or demonstrate to the reasonable satisfaction of the secretary of state or licensing authority that it did not occur, within sixty (60) days after service of the notice in accordance with § 48-208-104; and (3) The secretary of state or licensing authority certifies to the attorney general and reporter a description of the violation, that it properly notified the PLLC of the violation, and that the PLLC did not correct it, or demonstrate that it did not occur, within sixty (60) days after service of the notice, in accordance with § 48-208-104. Acts 1994, ch. 868, § 1.

Source: Tennessee Code (state release 76 via Public.Resource.Org) + public chapters (Tennessee Secretary of State)URL: https://archive.org/download/gov.tn.tca/release76.2021.05.21/gov.tn.tca.title.48.htmlFetched: 10/24/2026