FLORIDA’S LIMITED LIABILITY COMPANY ACT
solve the problem of the partners’ unlimited personal liability, nor did it afford total flexibility in structuring the deal.9 The search for the perfect transactional form continued.
Perfection is an elusive goal. So far, at least, no one has invented a form that meets everyone’s needs.10 Instead, over the last several years, we have seen a proliferation of business forms that has dra- matically altered the landscape. Now, in addition to partnerships, limited partnerships, and corporations, we have limited liability partnerships (LLPs), limited liability limited partnerships (LLLPs), and limited liability companies (LLCs). State-to-state variation in those new forms makes life even more exciting for those who thrive on complexity.
Although Florida was an early entrant in the forms market, it has only recently become competitive. Florida was fairly quick to adopt RUPA, albeit with some tinkering.11 However, it was not until 1999
that Florida adopted LLP provisions12 any hope of being widely used.
and an LLC statute13
The new LLP provisions are not all that different from anyone else’s. They constitute, if you like, a generic. That generic will be bought in Florida by people who want to do business in that form, and Florida will collect the filing fees. The new LLC statute, how-
cited as the Revised Uniform Partnership Act, or “RUPA.” As of 2001, the Revised Uniform Partnership Act had been adopted, with occasional variations, in 30 states (including Flor- ida) and the District of Columbia.
9. RUPA’s drafters considered, but ultimately rejected, giving the parties complete freedom of contract. See infra text accompanying note 32.
10. Although one author claims that Texas has done so. Thomas F. Blackwell, The Revolution is Here: The Promise of a Unified Business Entity Code, 24 J. CORP. L. 333
. I might consider this to be just another example of Texan hubris, were it not that
Mr. Blackwell might be right, my doubts to the contrary not withstanding, and (2) no
one who starts an article with a citation to a Beatles song can be fairly accused of taking himself too seriously.
11. FLA. STAT. §§ 620.81001-620.9902 (adopted in 1995). The legislature was un- doubtedly assisted in its deliberations by the fact that RUPA’s Reporters were both on the faculty at Florida State University. For a comprehensive discussion of the process and its results, see John W. Larson, Florida’s New Partnership Law: The Revised Uniform Part- nership Act and Limited Liability Partnerships, 23 FLA. ST. U. L. REV. 201 (1995).
12. Florida adopted LLP provisions in 1995, but they were not “full shield.” Partners were protected from tort liability but not from obligations arising from contracts. Florida also required professionals either to buy liability insurance or post a bond. Foreign LLPs could register in the state, although they had to comply with the insurance requirements for Florida partners. Nevertheless, since most foreign statutes provided a full liability shield, those Florida partnerships that wanted completely limited liability bought the for- eign product. Those competitive disadvantages were eliminated in 1999; Florida LLPs are now full shield and insurance is not required. FLA. STAT. § 620.8306 (2001).
13. Although Florida was the second state to adopt an LLC statute, Florida Limited Liability Company Act, FLA. STAT. §§ 608.401-608.514 (1982), that statute was the busi- ness form version of an Edsel. Nobody bought it. Single member LLCs were not permitted and (the coup de grace) LLCs were taxed as corporations. While Florida rejoices in the ab- sence of a personal income tax, it does have a corporate income tax. In 1997-98 those im- pediments were removed, setting the stage for a more thoroughgoing revision.