It’s
Deja Vu All Over Again
In Pannell v. Shannon,
425 S.W.3d 58 at 79, 80; 2014 WL 1101472, *7 (Ky. March 20, 2014), the Kentucky
Supreme Court wrote:
In fact,
“limited liability companies are creatures of statute,” controlled by Kentucky
Revised Statutes (KRS) Chapter 275, not primarily by the common law. To the
extent that common law doctrines could arguably govern limited liability
companies, the Kentucky Limited Liability Company Act “is in derogation of
common law,” KRS 275.003(1), and the traditional rule of statutory construction
that “require[s] strict construction of statutes which are in derogation of
common law shall not apply to its provisions.” Thus, to the extent the statutes
conflict with common law, the common law is displaced.
This Court
must therefore first look at the controlling statutory law. (citations
omitted).
In The Analytic Protocol for the Duty of
Loyalty Under the Prototype LLC Act, 63 Arkansas
Law Review 473 at 501-02 (2010), Professor Thomas Earl Geu and I
observed:
Moreover, and as a matter of interpretive policy, the law of
business associations seems to have become more “statutory” over time in ways
other than through the invention or recognition of “new” entities. Even the fiduciary provisions within states
like Delaware are the subject of great statutory detail. Professor Langbein has
explored this same trend toward statutes in trust law, suggesting several
reasons for the “statutorification” of trust law including speed, comprehensiveness,
and the ability to bring specific expertise to bear in increasingly complicated
and interrelated topical areas of law. It seems those reasons could also help
explain the general trend of the increase in statutory business association
law. If this supposition is correct,
courts should exercise great care
when analyzing or generalizing from one statute to another where the different
statutory schemes vary in manner of expression, detail of regulatory method,
and scope of application. (citations omitted).
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