Durham v. Grapetree, LLC, C.A. No. 7325-VCG (May 16, 2014)
By Eric Feldman and Eric Taylor
This is a case dealing with the interpretation of a Limited Liability Company Agreement for a family-owned Delaware Limited Liability Company, Grapetree, LLC (“Grapetree”), set up to manage inherited resort rental properties. The plaintiff in the suit, Andrew Durham (“Andrew”) is one of five members of Grapetree, all siblings, and the only non-managing member (under the 2008 OperatingAgreement of Grapetree, which governed during the time of the actions in dispute). Andrew is a self-employed landscape architect who made several expenditures over the years to maintain and improve the managed properties and seeks reimbursement for those expenses. The 2008 OperatingAgreement contains certain limitations on authority, namely that expenditures over $2,000 are subject to the majority vote of the members and all routine operational issues are subject to the majority vote of the managing members. (It should be noted that the limitation contained an apparent error requiring a majority “3/5” vote of the managing members, despite the fact that there were only four managing members.)