{"data":{"id":"us-dc/d.c.-code-29-801.07","jurisdiction":"us-dc","citation":"D.C. Code § 29-801.07","heading":"Operating agreement; scope, function, and limitations.","body":"(a)\nExcept as otherwise provided in subsections (b) and (c) of this section, the operating agreement shall govern:\n(1)\nRelations among the members as members and between the members and the limited liability company;\n(2)\nThe rights and duties under this chapter of a person in the capacity of manager;\n(3)\nThe activities and affairs of the company and the conduct of those activities and affairs; and\n(4)\nThe means and conditions for amending the operating agreement.\n\n(b)\nTo the extent the operating agreement does not otherwise provide for a matter described in subsection (a) of this section, this chapter shall govern the matter.\n\n(c)\nAn operating agreement shall not:\n(1)\nVary a limited liability company’s capacity under § 29-801.05 to sue and be sued in its own name;\n(2)\nVary the law applicable under § 29-801.06;\n(3)\nVary the provisions of § 29-802.04;\n(4)\nSubject to subsections (d) through (g) of this section, eliminate the duty of loyalty, the duty of care, or any other fiduciary duty;\n(5)\nEliminate the contractual obligation of good faith and fair dealing under § 29-804.09(d), but the operating agreement may prescribe the standards, if not manifestly unreasonable, by which the performance of the obligation is to be measured;\n(6)\nUnreasonably restrict the duties and rights stated in § 29-804.10;\n(7)\nVary the causes of dissolution specified in § 29-807.01(a)(4) and (5);\n(8)\nVary the requirement to wind up a limited liability company’s activities and affairs as specified in § 29-807.02;\n(9)\nUnreasonably restrict the right of a member to maintain an action under Subchapter 8 of this chapter;\n(10)\nRestrict the right to approve a merger or domestication under § 29-809.10 or Chapter 2 of this title of a member that will have personal liability with respect to a surviving, converted, or domesticated organization;\n(11)\nExcept as otherwise provided in § 29-801.08 or 29-801.09(b), restrict the rights under this chapter of a person other than a member or manager.\n(12)\nVary any requirement, procedure, or other provision of this title pertaining to:\n(A)\nRegistered agents; or\n(B)\nThe Mayor, including provisions pertaining to records authorized or required to be delivered to the Mayor for filing under this chapter;\n(13)\nRelieve or exonerate a person from liability for conduct involving bad faith, willful or intentional misconduct, or knowing violation of the law; or\n(14)\nVary the provisions of § 29-808.05, except that the operating agreement may provide that the company may not have a special litigation committee.\n(15)\n[(15)]Vary the power of a person to dissociate under § 29-807.01, except to require that notice of dissociation be in a record.\n\n(d)\nSubject to subsection (c) of this section, without limiting other terms that may be included in an operating agreement, the following rules apply:\n(1)\nThe operating agreement may specify the method by which a specific act or transaction that would otherwise violate the duty of loyalty may be authorized or ratified by one or more disinterested and independent persons after full disclosure of all material facts.\n(2)\nTo the extent the operating agreement of a member-managed limited liability company expressly relieves a member of a responsibility that the member would otherwise have under this chapter and imposes the responsibility on one or more other members, the operating agreement may, to the benefit of the member that the operating agreement relieves of the responsibility, also eliminate or limit any fiduciary duty that would have pertained to the responsibility.\n(3)\nIf not manifestly unreasonable, the operating agreement may:\n(A)\nRestrict or eliminate the aspects of the duty of loyalty stated in § 29-804.09;\n(B)\nIdentify specific types or categories of activities and affairs that do not violate the duty of loyalty;\n(C)\nAlter the duty of care, but may not authorize willful or intentional misconduct or knowing violation of law; and\n(D)\nAlter or eliminate any other fiduciary duty.\n\n(e)\nRepealed.\n\n(f)\nRepealed.\n\n(g)\nRepealed.\n\n(h)\nThe Superior Court shall decide, as a matter of law, any claim under subsection (c)(5) or (d)(3) of this section that a term of an operating agreement is manifestly unreasonable. The court:\n(1)\nShall make its determination as of the time the challenged term became part of the operating agreement and by considering only circumstances existing at that time; and\n(2)\nMay invalidate the term only if, in light of the purposes and activities and affairs of the limited liability company, it is readily apparent that:\n(A)\nThe objective of the term is unreasonable; or\n(B)\nThe term is an unreasonable means to achieve the provision’s objective.","path":["Title 29. Business Organizations. [Enacted title]","Chapter 8. Limited Liability Companies.","Subchapter I. General Provisions."],"source_url":"https://code.dccouncil.gov/us/dc/council/code/sections/29-801.07","current_through":"2026-08-20 (D.C. Law 26-175)","vintage":"","retrieved_at":"2026-08-29T05:44:07Z","sha256":"02b204f02fd2f9bd1bedf8b4f69ca5e9d4b1a3c1f41e8066175bdd48f2c7737e","source_id":"us-dc","stale":true,"prev":"us-dc/d.c.-code-29-801.06","next":"us-dc/d.c.-code-29-801.08"},"notice":"GroundRules: Original legal text. Not legal advice."}