The PLLC Publication Requirement
New York’s PLLC publication requirement is a relic from a bygone era when newspaper ads and announcements were the only way to ensure that the public had notice of new companies setting up shop. But despite the changes in technology and the decline of newspaper readership, the requirement remains law for newly-formed Professional Limited Liability Companies.
An Overview Of Section 1203
Section 1203 of the New York State Limited Liability Company Law requires that within 120 days after the effectiveness of the initial articles of organization, a PLLC must publish in two newspapers a copy of the articles of organization or a notice related to the formation of the PLLC. The newspapers must be designated by the county clerk of the county in which the office of the PLLC is located, as stated in the articles of organization. After publication, the printer or publisher of each newspaper will provide you with an affidavit of publication.
- Limited liability companies that fail to comply with the publication requirements within 120 days after their formation or qualification will have their authority to carry on, conduct or transact any business suspended.
- Any time following the suspension of a limited liability company’s authority to carry on, conduct or transact business, the limited liability company may file the certificate of publication with the affidavits of publication of the newspapers annexed thereto, at which time the suspension of such limited partnership ‘s authority to carry on, conduct or transact business shall be annulled.
The Costs Of PLLC Publication
The costs of publication can range from $600 to $1600, depending on the county in which your PLLC’s office is located, and the special advertising rates for this type of announcement charged by each newspaper. And there is a $50 Certificate of Publication filing fee.
The Consequences Of A Failure To Publish
The consequences of failing to comply with the publication requirement can be burdensome. PLLCs that fail to comply with the publication requirements within the designated timeframe will have their authority to carry on, conduct, or transact any business suspended. However, the law (Section 1203 of the New York State Limited Liability Company Law) does offer some protection, providing:
The failure of a professional service limited liability company to cause such copy or notice to be published and such certificate of publication and affidavits of publication to be filed with the department of state within such one hundred twenty day period or the suspension of such professional service limited liability company’s authority to carry on, conduct or transact business in this state pursuant to this subparagraph shall not limit or impair the validity of any contract or act of such professional service limited liability company, or any right or remedy of any other party under or by virtue of any contract, act or omission of such professional service limited liability company, or the right of any other party to maintain any action or special proceeding on any such contract, act or omission, or right of such professional service limited liability company to defend any action or special proceeding in this state, or result in any member, manager or agent of such professional service limited liability company becoming liable for the contractual obligations or other liabilities of the professional service limited liability company.
Section 1203 of the New York State Limited Liability Company Law
However, while the law provides that contracts made by the company and the liability shield will remain intact, you may not be able to obtain a certificate of good standing, which some vendors require when working with your company. And in at least one case of which we are aware, a party refused to comply with a contract it had signed by claiming that its entity did not exist because it had not properly made publication. Although the argument lost, the parties were required to go through the expense of litigation the issue.
A failure to publish may be cured by publication at any time:
If, at any time following the suspension of a professional service limited liability company’s authority to carry on, conduct or transact business in this state pursuant to this subparagraph, such professional service limited liability company shall cause proof of publication in substantial compliance with the provisions (other than the one hundred twenty day period) of this subparagraph, consisting of the certificate of publication of the professional service limited liability company with the affidavits of publication of the newspapers annexed thereto, to be filed with the department of state, such suspension of such professional service limited liability company’s authority to carry on, conduct or transact business shall be annulled.
Id.
While complying with the publication requirement may be an added hassle for lawyers, we can help you seamlessly handle the process.
Please note that the information provided on this website is for general informational purposes only and is not intended as legal or tax advice. The information is subject to change, and it is important to consult a specialist before making any decisions. Law Ledgers provides accounting services to New York lawyers and law firms, including escrow protection, tax advice and bookkeeping administration. Contact us today for personalized support.
