DISSOLUTION AND WINDING UP

Idaho Code tit. 30, ch. 30-25, pt. 30-25-7

in effect

Idaho Code § 30-25-701 EVENTS CAUSING DISSOLUTION.

30-25-701. EVENTS CAUSING DISSOLUTION. (a) A limited liability company is dissolved, and its activities and affairs must be wound up, upon the occurrence of any of the following: (1) An event or circumstance that the operating agreement states causes dissolution; (2) The affirmative vote or consent of all the members; (3) The passage of ninety (90) consecutive days during which the company has no members unless before the end of the period: (A) Consent to admit at least one (1) specified person as a member is given by transferees owning the rights to receive a majority of distributions as transferees at the time the consent is to be effective; and (B) At least one (1) person becomes a member in accordance with the consent; (4) On application by a member, the entry by the district court of an order dissolving the company on the grounds that: (A) The conduct of all or substantially all the company’s activities and affairs is unlawful; or (B) It is not reasonably practicable to carry on the company’s activities and affairs in conformity with the certificate of organization and the operating agreement; or (C) The managers or those members in control of the company: (i) Have acted, are acting, or will act in a manner that is illegal or fraudulent; or (ii) Have acted or are acting in a manner that is oppressive and was, is, or will be directly harmful to the applicant; or (5) The signing and filing of a statement of administrative dissolution by the secretary of state under section 30-21-602 , Idaho Code. (b) In a proceeding brought under subsection (a)(4)(B) of this section, the court may order a remedy other than dissolution. [30-25-701, added 2015, ch. 243, sec. 49, p. 891; am. 2017, ch. 100, sec. 1, p. 248; am. 2021, ch. 321, sec. 8, p. 949.]

Idaho Code § 30-25-702 WINDING UP.

30-25-702. WINDING UP. (a) A dissolved limited liability company shall wind up its activities and affairs and, except as otherwise provided in section 30-25-703 , Idaho Code, the company continues after dissolution only for the purpose of winding up. (b) In winding up its activities and affairs, a limited liability company: (1) Shall discharge the company’s debts, obligations, and other liabilities, settle and close the company’s activities and affairs, and marshal and distribute the assets of the company; and (2) May: (A) Deliver to the secretary of state for filing a statement of dissolution stating the name of the company and that the company is dissolved; (B) Preserve the company activities, affairs, and property as a going concern for a reasonable time; (C) Prosecute and defend actions and proceedings, whether civil, criminal, or administrative; (D) Transfer the company’s property; (E) Settle disputes by mediation or arbitration; (F) Deliver to the secretary of state for filing a statement of termination stating the name of the company and that the company is terminated; and (G) Perform other acts necessary or appropriate to the winding up. (c) If a dissolved limited liability company has no members, the legal representative of the last person to have been a member may wind up the activities and affairs of the company. If the person does so, the person has the powers of a sole manager under section 30-25-407 (c), Idaho Code, and is deemed to be a manager for the purposes of section 30-25-304 (a), Idaho Code. (d) If the legal representative under subsection (c) of this section declines or fails to wind up the limited liability company’s activities and affairs, a person may be appointed to do so by the consent of transferees owning a majority of the rights to receive distributions as transferees at the time the consent is to be effective. A person appointed under this subsection: (1) Has the powers of a sole manager under section 30-25-407 (c), Idaho Code, and is deemed to be a manager for the purposes of section 30-25-304 (a), Idaho Code; and (2) Shall deliver promptly to the secretary of state for filing an amendment to the company’s certificate of organization stating: (A) That the company has no members; (B) The name and street and mailing addresses of the person; and (C) That the person has been appointed pursuant to this subsection to wind up the company. (e) The district court may order judicial supervision of the winding up of a dissolved limited liability company, including the appointment of a person to wind up the company’s activities and affairs: (1) On the application of a member, if the applicant establishes good cause; (2) On the application of a transferee, if: (A) The company does not have any members; (B) The legal representative of the last person to have been a member declines or fails to wind up the company’s activities; and (C) Within a reasonable time following the dissolution, a person has not been appointed pursuant to subsection (c) of this section; or (3) In connection with a proceeding under section 30-25-701 (a), Idaho Code. [30-25-702, added 2015, ch. 243, sec. 49, p. 891.]

Idaho Code § 30-25-703 RESCINDING DISSOLUTION.

30-25-703. RESCINDING DISSOLUTION. (a) A limited liability company may rescind its dissolution, unless a statement of termination applicable to the company is effective, the district court has entered an order under section 30-25-701 (a)(4), Idaho Code, dissolving the company, or the secretary of state has dissolved the company under section 30-21-602 , Idaho Code. (b) Rescinding dissolution under this section requires: (1) The affirmative vote or consent of each member; (2) If a statement of dissolution applicable to the limited liability company has been filed by the secretary of state but has not become effective, the delivery to the secretary of state for filing of a statement of withdrawal under section 30-21-204 , Idaho Code, applicable to the statement of dissolution; and (3) If a statement of dissolution applicable to the limited liability company is effective, the delivery to the secretary of state for filing of a statement of rescission stating the name of the company and that dissolution has been rescinded under this section. (c) If a limited liability company rescinds its dissolution: (1) The company resumes carrying on its activities and affairs as if dissolution had never occurred; (2) Subject to paragraph (3) of this subsection, any liability incurred by the company after the dissolution and before the rescission is effective is determined as if dissolution had never occurred; and (3) The rights of a third party arising out of conduct in reliance on the dissolution before the third party knew or had notice of the rescission may not be adversely affected. [30-25-703, added 2015, ch. 243, sec. 49, p. 892; am. 2021, ch. 321, sec. 9, p. 950.]

Idaho Code § 30-25-704 KNOWN CLAIMS AGAINST DISSOLVED LIMITED LIABILITY COMPANY.

30-25-704. KNOWN CLAIMS AGAINST DISSOLVED LIMITED LIABILITY COMPANY. (a) Except as otherwise provided in subsection (d) of this section, a dissolved limited liability company may give notice of a known claim under subsection (b) of this section, which has the effect provided in subsection (c) of this section. (b) A dissolved limited liability company may in a record notify its known claimants of the dissolution. The notice must: (1) Specify the information required to be included in a claim; (2) State that a claim must be in writing and provide a mailing address to which the claim is to be sent; (3) State the deadline for receipt of a claim, which may not be less than one hundred twenty (120) days after the date the notice is received by the claimant; and (4) State that the claim will be barred if not received by the deadline. (c) A claim against a dissolved limited liability company is barred if the requirements of subsection (b) of this section are met and: (1) The claim is not received by the specified deadline; or (2) If the claim is timely received but rejected by the company: (A) The company causes the claimant to receive a notice in a record stating that the claim is rejected and will be barred unless the claimant commences an action against the company to enforce the claim not later than ninety (90) days after the claimant receives the notice; and (B) The claimant does not commence the required action not later than ninety (90) days after the claimant receives the notice. (d) This section does not apply to a claim based on an event occurring after the date of dissolution or a liability that on that date is contingent. [30-25-704, added 2015, ch. 243, sec. 49, p. 893.]

Idaho Code § 30-25-705 OTHER CLAIMS AGAINST DISSOLVED LIMITED LIABILITY COMPANY.

30-25-705. OTHER CLAIMS AGAINST DISSOLVED LIMITED LIABILITY COMPANY. (a) A dissolved limited liability company may publish notice of its dissolution and request persons having claims against the company to present them in accordance with the notice. (b) A notice under subsection (a) of this section must: (1) Be published at least once in a newspaper of general circulation in the county in this state in which the dissolved limited liability company’s principal office is located or, if the principal office is not located in this state, in the county in which the office of the company’s registered agent is or was last located; (2) Describe the information required to be contained in a claim, state that the claim must be in writing, and provide a mailing address to which the claim is to be sent; and (3) State that a claim against the company is barred unless an action to enforce the claim is commenced not later than three (3) years after publication of the notice. (c) If a dissolved limited liability company publishes a notice in accordance with subsection (2) of this section, the claim of each of the following claimants is barred unless the claimant commences an action to enforce the claim against the company not later than three (3) years after the publication date of the notice: (1) A claimant that did not receive notice in a record under section 30-25-704 , Idaho Code; (2) A claimant whose claim was timely sent to the company but not acted on; and (3) A claimant whose claim is contingent at, or based on an event occurring after, the date of dissolution. (d) A claim not barred under this section or section 30-25-704 , Idaho Code, may be enforced: (1) Against a dissolved limited liability company, to the extent of its undistributed assets; and (2) Except as otherwise provided in section 30-25-706 , Idaho Code, if assets of the company have been distributed after dissolution, against a member or transferee to the extent of that person’s proportionate share of the claim or of the company’s assets distributed to the member or transferee after dissolution, whichever is less, but a person’s total liability for all claims under this paragraph may not exceed the total amount of assets distributed to the person after dissolution. [30-25-705, added 2015, ch. 243, sec. 49, p. 893; am. 2021, ch. 321, sec. 10, p. 950.]

Idaho Code § 30-25-706 COURT PROCEEDINGS.

30-25-706. COURT PROCEEDINGS. (a) A dissolved limited liability company that has published a notice under section 30-25-705 , Idaho Code, may file an application with the district court in the county where the company’s principal office is located or, if the principal office is not located in this state, where the office of its registered agent is or was last located, for a determination of the amount and form of security to be provided for payment of claims that are reasonably expected to arise after the date of dissolution based on facts known to the company and: (1) At the time of application: (A) Are contingent; or (B) Have not been made known to the company; or (2) Are based on an event occurring after the date of dissolution. (b) Security is not required for any claim that is or is reasonably anticipated to be barred under section 30-25-705 , Idaho Code. (c) Not later than ten (10) days after the filing of an application under subsection (a) of this section, the dissolved limited liability company shall give notice of the proceeding to each claimant holding a contingent claim known to the company. (d) In a proceeding under this section, the court may appoint a guardian ad litem to represent all claimants whose identities are unknown. The reasonable fees and expenses of the guardian, including all reasonable expert witness fees, must be paid by the dissolved limited liability company. (e) A dissolved limited liability company that provides security in the amount and form ordered by the court under subsection (a) of this section satisfies the company’s obligations with respect to claims that are contingent, have not been made known to the company, or are based on an event occurring after the date of dissolution, and such claims may not be enforced against a member or transferee on account of assets received in liquidation. [30-25-706, added 2015, ch. 243, sec. 49, p. 894.]

Idaho Code § 30-25-707 DISPOSITION OF ASSETS IN WINDING UP.

30-25-707. DISPOSITION OF ASSETS IN WINDING UP. (a) In winding up its activities and affairs, a limited liability company shall apply its assets to discharge its obligations to creditors, including members that are creditors. (b) After a limited liability company complies with subsection (a) of this section, any surplus must be distributed in the following order, subject to any charging order in effect under section 30-25-503 , Idaho Code: (1) To each person owning a transferable interest that reflects contributions made and not previously returned, an amount equal to the value of the unreturned contributions; and (2) Among members and persons dissociated as members in proportion to their respective rights to share in distributions immediately before the dissolution of the company, except to the extent necessary to comply with any transfer effective under section 30-25-502 , Idaho Code. (c) If a limited liability company does not have sufficient surplus to comply with subsection (b)(1) of this section, any surplus must be distributed among the owners of transferable interests in proportion to the value of the respective unreturned contributions. (d) All distributions made under subsections (b) and (c) of this section must be paid in money. [30-25-707, added 2015, ch. 243, sec. 49, p. 894.]

Idaho Code § 30-25-708 SUBJECTS COVERED OUTSIDE CHAPTER.

30-25-708. SUBJECTS COVERED OUTSIDE CHAPTER. The following subjects are covered outside this chapter: (1) Administrative dissolution – sections 30-21-601 and 30-21-602 , Idaho Code. (2) Reinstatement – section 30-21-603 , Idaho Code. (3) Judicial review of denial of reinstatement – section 30-21-604 , Idaho Code. [30-25-708, added 2015, ch. 243, sec. 49, p. 895.]

Source: Idaho State Legislature (legislature.idaho.gov)URL: https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH25PT7/Fetched: 10/20/2026