To protect the interests of individual members, a company may require unanimous consent for certain actions—especially when a business decision has a significant impact on the success of the LLC. For example, members may require unanimous consent on critical issues, such as:
1. The assignment of ownership rights of company property
Members can prevent unauthorized behavior involving company property by requiring unanimous consent for selling, loaning, mortgaging, or trading company property.
2. Incurring company liabilities over a fixed dollar amount
Expansion of the LLC may require significant financial investment with a large debt load. To limit the risk to individual members, they may set a dollar amount for acceptable levels of liability. Any liability over that amount would require the consent of all members.
3. Incurring expenses over a fixed dollar amount
Members can control unauthorized spending by setting a limit on individual transactions. Any expenditures over this amount would require the consent of all members.
4. Releasing any company claim except for payment in full
The company may have a legal claim against another person or business entity, such as when someone owes the company debt. In this case, it’s in the members’ best interest for these obligations to be paid in full. As such, members may require unanimous consent before releasing a claim for less than full consideration.