LLC Member Dissociation, Withdrawal, and Expulsion Requirements in New Mexico

At a glance

Requirements one by one

Perpetual and term companies use different withdrawal rules

NMSA 1978, § 53-19-37(A) gives a member of a perpetual-existence LLC a default right to withdraw at any time by giving the other members 30 days' prior written notice. The articles or written operating agreement may change both the right and the notice requirement.

For a definite-term or particular-undertaking LLC, § 53-19-37(B) supplies no default early-withdrawal right. An unauthorized attempt is ineffective, so it does not itself complete dissociation, but the member is deemed to relinquish all voting and management or control participation. The statute states no acceptance requirement, specified-later-date rule, or member-exit filing.

Chapter 53, Article 19 is the governing Limited Liability Company Act. §§ 53-19-1, 53-19-2, and 53-19-6 define the operative statuses and recognize perpetual, definite-term, and particular-undertaking durations.

New Mexico does not define wrongful dissociation

The Act supplies no separate wrongful-dissociation category or statutory exit-damages formula. Its concrete consequence for an unauthorized term-company attempt is the unusual one in § 53-19-37(B): membership does not end, but voting and management participation do.

That result is different from a rightful withdrawal. Under § 53-19-37(C), the member ceases membership on the effective date, loses governance and further distribution participation, and receives the statute's fair-market-value payment unless the governing documents provide otherwise.

Removal needs the documents or the full-assignment route

Under § 53-19-38(A)(3), membership ends when removal follows a provision in the articles or operating agreement. § 53-19-17(B)(2) supplies an all-other- member vote, approval, or consent threshold unless the documents provide a different rule.

Section 53-19-38(A)(3)(b) adds a narrower default route: after a member assigns the entire interest, all members who have not assigned may vote to remove the assignor, unless the documents alter that rule. Assignment alone does not end status; §§ 53-19-32 to 53-19-36 keep the assignor a member until an assignee is admitted or removal occurs.

The Act has no ordinary judicial member-expulsion procedure. §§ 53-19-39 to 53-19-40 instead let a court dissolve the LLC, on application by or for a member, when carrying on in conformity with the articles or agreement is not reasonably practicable. That is a company-level remedy.

Insolvency, death, incapacity, and entity events can end status

Unless the articles or operating agreement provide otherwise—or all members consent in writing to continuation—§ 53-19-38(B) ends membership for the listed creditor assignment, voluntary bankruptcy and insolvency filings, adjudication, relief petition, and consensual fiduciary-appointment events. An involuntary proceeding has a 120-day dismissal period; a nonconsensual appointment has the stated 90-day and post-stay periods.

The same section covers individual death or adjudicated incompetency, trust termination, an LLC or partnership member's dissolution and start of winding up, corporate dissolution or charter revocation with its 90-day reinstatement period, and an estate's full-interest distribution. A new trustee alone does not end a trust member's status.

Article 19 lists no separate member-level foreclosure, merger, conversion, domestication, or interest-exchange event. §§ 53-19-60.1 to 53-19-62.2 instead treat an LLC's own conversion and merger at company level: owners ordinarily continue through conversion unless the agreement differs, while a non-surviving merger party's separate existence terminates.

Dissociation separates governance from economics

Under § 53-19-38(D), a former member loses member voting, management or control participation, and the statutory right to demand information. Depending on the event and documents, the person may continue to hold an LLC interest.

The Act does not say that member dissociation automatically ends a separately held manager office. §§ 53-19-15 to 53-19-16 separately govern manager status and agreement-variable management duties, and they state no general postexit-duty cutoff. The company record must therefore be checked for both capacities.

The default dissociation payout is fair market value

Under § 53-19-24, the articles and operating agreement control the distribution when dissociation does not require winding up. If they do not specify the effect, the dissociating member receives fair market value of the LLC interest as of dissociation within a reasonable time. Section 53-19-37(C) states the same fair-market-value default for rightful voluntary withdrawal.

The payout remains subject to the solvency limits and liability rules in §§ 53-19-26 to 53-19-28. A member entitled to a lawful distribution has creditor remedies for it; a member or manager who approved a prohibited excess distribution may face the section's company liability.

Records, liabilities, filings, and dissolution remain separate

Under § 53-19-21, a written contribution promise ordinarily is not excused by death, disability, or another inability to perform. Section 53-19-32 also says assignment alone does not release a member's existing liability.

§ 53-19-19 requires the LLC to retain a list of current and former members and managers and every current and prior operating agreement. Its inspection right is written for a member; § 53-19-38(D) expressly ends a former member's statutory information demand. Article 19 states no event-driven public filing for an ordinary member exit. Articles of dissolution are a different filing under § 53-19-41.

Member dissociation also does not itself dissolve the LLC. Since the current § 53-19-39 list is limited to a document event, majority-voting-power written consent, or a judicial decree, status exit and company winding up must not be collapsed into one step.

What trips people up

• An ineffective attempted withdrawal still has consequences. In a term or undertaking company, the member remains a member but gives up statutory voting and management participation.
• Assignment alone does not end membership. Assignee admission or the special all-nonassigning-member removal route must also occur.
• A 30-day notice is not universal. It is the default for a perpetual- existence LLC and remains subject to the articles and operating agreement.
• The payout uses fair market value, not fair value. The statute uses its own phrase and makes the governing documents primary.

Common questions

May the documents prohibit withdrawal from a perpetual LLC?

Yes. Section 53-19-37(A) begins with an express articles-or-operating-agreement override.

Can the other members remove someone who assigned everything?

Yes, unless the documents provide otherwise. Every member who has not assigned must approve the removal under § 53-19-38(A)(3)(b).

Does death leave the estate as a voting member?

No by default. Death ends the individual's member status under § 53-19-38(B), and § 53-19-34 gives the personal representative the rights of an assignee of the LLC interest.

Does a member's exit dissolve the company?

Not by itself. Dissolution follows § 53-19-39's document, written-consent, or judicial-decree routes.

Statutes and sources

• NMSA 1978, §§ 53-19-1 to 53-19-2, 53-19-6, and 53-19-15 to 53-19-17 — Act, status definitions, company duration, governance, duties, and removal vote. Official annotated Chapter 53 (accessed August 30, 2026).
• NMSA 1978, §§ 53-19-19, 53-19-21, and 53-19-24 to 53-19-28 — records, contribution liability, dissociation payout, distribution limits, and remedies. Official annotated Chapter 53 (accessed August 30, 2026).
• NMSA 1978, §§ 53-19-32 to 53-19-41 — assignment, representatives, withdrawal, removal and automatic events, effects, and separate dissolution. Official annotated Chapter 53 (accessed August 30, 2026).
• NMSA 1978, §§ 53-19-60.1 to 53-19-62.2 — company-level conversion and merger boundaries. Official annotated Chapter 53 (accessed August 30, 2026).
• New Mexico Compilation Commission, Scope of Coverage — NMSA 1978 current through the 2026 Second Session. Official coverage page (accessed August 30, 2026).