Am I entitled to interest on a return of capital payment late by 7 years?

[kartonio777]

Jurisdiction

New Jersey

I made a private investment as an accredited investor into a New Jersey LLC in 2017. The LLC issued return of capital payment (well over $10,000 for my share) later that year and notified me about it, but never sent the payment. A year later, I sent a reminder and received a misleading answer, which acknowledged and issued a different payment, which was also not sent in time. Fast forward to 2025, I discover this error, GP finally admits it and sends me the payment, 7 years delayed! Am I entitled to interest under New Jersey law? The Operating Agreement refers to Prime + 3.5% interest for loans from GP to the LLC but nothing about LP to LLC loans or about dispute procedures.

 

[zddoodah]

I made a private investment as an accredited investor into a New Jersey LLC in 2017.

How much was your investment?

The LLC issued return of capital payment (well over $10,000 for my share) later that year and notified me about it, but never sent the payment.

If the LLC never sent you the payment, how do you know it issued payment? Did you simply meant that, sometime later in 2017, you received a notification that your investment would be returned, but you never received payment?

A year later, I sent a reminder and received a misleading answer, which acknowledged and issued a different payment, which was also not sent in time.

In time for what? And again, if you never received the payment, how do you know it was issued?

Fast forward to 2025, I discover this error, GP finally admits it and sends me the payment, 7 years delayed!

Who/what is "GP"*? Also, the implication here is that nothing at all happened between 2018 and 2025. Is that the case?

Am I entitled to interest under New Jersey law?

Under the law? No.

The Operating Agreement refers to Prime + 3.5% interest for loans from GP to the LLC but nothing about LP to LLC loans or about dispute procedures.

Who/what is "LP"*?

OK...no one here has read the OA, so no one can intelligently speak to what you might be entitled to under that agreement.

You should be aware that, under New Jersey law, the statute of limitations for breach of written contract is six years. If there was money due to you in 2017 or 2018, then the SOL expired in 2023 or 2024. If you want an assessment as to whether the payment in 2025 may have revived the limitations period, you'll need to have a local attorney review the relevant documents.

* - If "GP" and "LP" mean general partner and limited partner, LLCs don't have partners.

 

[kartonio777]

How much was your investment?


Total investment was 100k, but this was a partial ROC for 15k. The LLC is still active

If the LLC never sent you the payment, how do you know it issued payment? Did you simply meant that, sometime later in 2017, you received a notification that your investment would be returned, but you never received payment?

Yes, exactly


In time for what? And again, if you never received the payment, how do you know it was issued?




Who/what is "GP"*? Also, the implication here is that nothing at all happened between 2018 and 2025. Is that the case?

I meant Manager and Members, not GP a nd LP


Under the law? No.




Who/what is "LP"*?

OK...no one here has read the OA, so no one can intelligently speak to what you might be entitled to under that agreement.

You should be aware that, under New Jersey law, the statute of limitations for breach of written contract is six years. If there was money due to you in 2017 or 2018, then the SOL expired in 2023 or 2024. If you want an assessment as to whether the payment in 2025 may have revived the limitations period, you'll need to have a local attorney review the relevant documents.

* - If "GP" and "LP" mean general partner and limited partner, LLCs don't have partners.

Thank you, i think you addressed the core of my question