Prominent Delaware corporate lawyer and blawgger Francis Pileggi reviews Larry Ribstein's new book The Rise of the Uncorporation
Anyone who wants to be familiar with the cutting edge of the law on LLCs, LPs, GPs and related entities, referred to as “uncorporations” by Larry Ribstein (and often called Alternative Entity Law in Delaware), should read the latest book from nationally recognized expert Professor Larry Ribstein, titled: “The Rise of the Uncorporation” (Oxford University Press 2010). ...
Ribstein explains that the uncorporation provides a fundamental alternative to the corporation in dealing with a central problem of business organizations; namely, agency costs or collective action issues arising from the delegation of power over investments to non-owner managers and controlling owners. The uncorporation provides a different approach to addressing the two main problems in which all business associations need to grapple: delegating discretion to agents and allocating decision-making power among the owners. What the book calls the “LLC Revolution” freed businesses from needing to incorporate in order to receive the benefit of limited liability and other corporate features.
The nine chapters of the book cover topics such as “Why Study Uncorporations,” to the early history of partnerships and the rise of the corporation. Professor Ribstein addresses the problems of the “close corporation” and the evolution of the modern uncorporation. He discusses current issues with uncorporations such as management, the financial rights of members, fiduciary duties and dissolution, as well as transferring of interests. He concludes the book with a discussion of the likely direction that the future holds for the uncorporation and the reason why the uncorporation matters.
This book fills a void due to the relative dearth of scholarship regarding LLCs and other “uncorporations” as compared to voluminous case law and commentary on corporations and corporate statutes.
This work provides the first general theoretical and practical overview of alternatives to incorporation. It covers the history, law and finance of unincorporated firms and ancillary concepts related to the evolution of those firms, as well as an analysis of likely future trends in the field of business organization.
I concur with Francis' recommendation. Larry's new book is a very important contribution. OTOH, if you're looking for a more traditional treatise on agency, partnership, and LLCs, may I suggest my own Agency, Partnership & Liabilitiy Companies (Concepts & Insights)
