Louisiana — Can a Will Override an LLC Operating Agreement to Give My Business Interest to My Son? | Louisiana Estate Planning | FastCounsel
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Louisiana — Can a Will Override an LLC Operating Agreement to Give My Business Interest to My Son?

August 18, 2025 5 min read

Detailed Answer

Short answer: Generally no — a last will and testament cannot unilaterally defeat a valid, existing limited liability company (LLC) operating agreement that controls transfer of membership rights. Under Louisiana law the member’s ownership interest is subject to the LLC’s contractual rules (such as transfer restrictions, buy‑sell or right‑of‑first‑refusal provisions). When a member dies, the decedent’s will can pass whatever property the decedent actually owned, but that property will pass subject to any enforceable contractual limitations in the operating agreement and to Louisiana succession rules. For primary sources, see the Louisiana Legislature’s search pages on limited liability companies and successions: https://www.legis.la.gov/Legis/LawSearch.aspx?search=limited%20liability%20company and https://www.legis.la.gov/Legis/LawSearch.aspx?search=successions.

How LLC membership and wills interact in Louisiana

1. Types of rights attached to a membership interest. A membership interest typically bundles two types of rights: (a) economic rights (right to share in profits, losses, and distributions), and (b) governance rights (right to vote, manage, or be admitted as a member). An operating agreement often separates those rights such that an estate or devisee might inherit economic rights but not automatically take on governance rights.

2. Contractual transfer restrictions. Operating agreements commonly include clauses that limit transfers on death (for example: requiring written consent of a majority or all members, imposing a buyout at a formula or fair market value, or granting the LLC/other members a right of first refusal). Those contractual limits are generally enforceable against the decedent’s estate and beneficiaries.

3. What your will actually conveys. If your will leaves “my LLC interest” to your son, the will conveys the decedent’s property interest to the son, but the son receives only what the decedent owned under the LLC agreement. If the operating agreement requires approval to become a member, the son may receive the economic interest (distributions) but not the membership (voting/management) rights unless the members admit him according to the agreement’s terms. If the operating agreement calls for a mandatory buyout on a member’s death, the estate (not the son personally) will usually be paid the buyout amount; the son would get the buyout proceeds if they pass to him under the will.

4. Estate administration and “transmission” principles. Under Louisiana succession rules, the estate’s executor or administrator steps into the decedent’s shoes and must handle the decedent’s LLC interest consistent with the operating agreement and applicable succession rules. Any attempt in the will to override a clear contractual transfer restriction will likely fail; the estate must follow the transfer procedures in the operating agreement.

Common outcomes under hypothetical facts

Hypothetical 1 — Operating agreement permits transfers only with unanimous member consent and includes a buyout on death. Result: Your estate will either sell the decedent’s interest to the other members under the buyout terms or the members will consent to admit your son. If the members exercise the buyout, the estate receives cash and your son inherits that cash rather than membership rights.

Hypothetical 2 — Operating agreement is silent about death, or expressly allows transfer on death. Result: The son may inherit full membership rights (economic and governance) directly, provided state law or the agreement’s membership admission provisions do not require separate action by the remaining members.

Hypothetical 3 — The LLC interest is community property of a married member. Result: Louisiana marital property rules affect what passes by will; the spouse may have rights to the interest that impact what your will can transfer. If you are unsure about whether the interest is separate or community property, get advice from a Louisiana attorney because that classification changes succession outcomes.

Practical steps to protect your intent

– Review the operating agreement now. Look for transfer restrictions, death/buyout clauses, right of first refusal, admission procedures, and valuation methods.

– If you want your child to step into membership and managerial rights, amend the operating agreement while you’re alive (if other members agree) to allow that transfer on death or to name an incoming member. Operating agreements are contracts — changing them during life is more reliable than relying on a will after death.

– If amendment is not possible, consider alternative estate planning tools: gifting membership interests during life (subject to transfer rules), creating a trust that holds the interest and complies with the agreement, or negotiating a buyout arrangement with the other members.

– Work with the LLC’s lawyer or a Louisiana succession attorney. The executor must follow both the will and the operating agreement and must handle notice, valuation, and possible buyout mechanics correctly.

When a court may get involved

If members or the estate dispute whether the operating agreement’s transfer rules apply, or if the will includes language that the LLC contends violates the agreement, the dispute can end up in court. Courts will interpret the operating agreement as a contract (applying Louisiana contract and succession law) and will enforce unambiguous transfer restrictions.

Helpful Hints

  • Do not assume a will alone will make your child a voting member. Check the operating agreement first.
  • If the operating agreement imposes a buyout on death, the estate (not necessarily your heir) receives the buyout payment.
  • Make your wishes clear in both estate documents and in the LLC’s governing documents. Consistent documents avoid litigation.
  • Consider a lifetime transfer or use of a trust to avoid forced sale or membership disputes after death.
  • If the membership interest is community property, consult a Louisiana succession attorney — forced heirship and marital property rules can complicate disposition.
  • Inform your executor of the existence and location of the operating agreement and company records; timely notice to the LLC and compliance with any required procedures is crucial.

State resources: Louisiana Revised Statutes and Civil Code topics about business organizations and successions are available through the Louisiana Legislature: https://www.legis.la.gov/Legis/LawSearch.aspx?search=limited%20liability%20company and https://www.legis.la.gov/Legis/LawSearch.aspx?search=successions.

Disclaimer: This is general information about Louisiana law and does not constitute legal advice. I am not a lawyer. For advice tailored to your situation, consult a licensed Louisiana attorney experienced in LLC and succession matters.

The information on this site is for general informational purposes only, may be outdated, and is not legal advice; do not rely on it without consulting your own attorney.