Michigan House Bill HB4798

Michigan 2023-2024 Regular Session

• Introduced: 6/15/23
• Refer: 6/15/23

Caption

Businesses: limited liability companies; certain references in the Michigan limited liability company act; make gender neutral. Amends sec. 504 of 1993 PA 23 (MCL 450.4504). TIE BAR WITH: HJR F'23

Impact

The proposed amendment to Section 504 of the Michigan LLC Act will directly impact the way limited liability companies handle the ownership interests of married couples. By allowing spouses to hold these interests in joint tenancy with full rights of survivorship, the law acknowledges changing dynamics in family structures while simplifying the process of ownership transfer upon the death of one spouse. This change could lead to increased clarity and equity in how LLCs approach membership benefits and rights, potentially enhancing business operations involving family-owned enterprises.

Summary

House Bill 4798 seeks to amend the Michigan Limited Liability Company Act, specifically to make gender references within the statute more inclusive by removing gender-specific language. This change primarily affects how membership interests in limited liability companies (LLCs) are described, allowing spouses to hold membership interests in a manner similar to property ownership laws in Michigan, specifically regarding joint tenancy. The bill aims to modernize legal language and reflect contemporary societal norms regarding gender neutrality in laws governing property and business ownership.

Contention

While the bill addresses an important aspect of equality in property rights, discussions surrounding its implications might arise, particularly concerning traditional ownership structures in businesses. Critics may argue that while the intention is to promote inclusivity, changing long-standing laws can create confusion. Some may worry that broader language could lead to misinterpretation of ownership rights in complicated familial or business scenarios. However, proponents contend that the move towards gender neutrality within the legal framework is necessary for inclusive representation in legislation.