In Re: Sky Harbor Hotel Properties, LLC, Debtor. Sky Harbor Hotel Properties, LLC, Plaintiff v. Patel Properties…

Summary

The court held that, under Arizona's former LLC Act, an LLC manager owes common-law fiduciary duties to the LLC, and an LLC member owes those duties when acting as the LLC's agent. It also held that a valid operating agreement may limit or eliminate those fiduciary duties, but may not eliminate the implied covenant of good faith and fair dealing. The court answered the certified questions on that basis.