In the afternoon of September 6, 1999, an explosion leveled the home of Jerry Usovsky (Usovsky) in Richland, Iowa. Tragically, seven people who had gathered in the home to celebrate the Labor Day holiday died from the explosion. Six others were injured, some seriously. The likely cause of the explosion was stray propane gas. The survivors and executors of the estates of those who died eventually filed a lawsuit seeking monetary damages against a host of defendants. The legal theories of recovery included negligence, breach of warranty, and strict liability. The defendants included Iowa Double Circle, L.C. (Double Circle) and Farmers Cooperative Association of Keota (Keota). 

   Double Circle is an Iowa limited liability company. It is a supplier of propane, and delivered propane to Usovsky’s home prior to the explosion. Keota is one of two members in Double Circle. It owns a ninety-five percent interest in the company. The other member is Farmland Industries, Inc. (Farmland Industries), a regional cooperative. Keota and Farmland Industries formed Double Circle in 1996 from an existing operation.

   Keota is a farm cooperative that provides a variety of farm products and services to area farmers. It is a member of Farmland Industries and is managed by Dave Hopscheidt (Hopscheidt). The executive committee of Keota’s board of directors serves as the board of directors of Double Circle, along with a representative of Farmland Industries. Keota provides managerial services to Double Circle, pursuant to a management agreement between Keota and Double Circle. Keota’s duties under the agreement include ‘‘human resource and safety management.’’ Hopscheidt oversees the daily operations of both Keota and Double Circle. However, Keota and Double Circle operate as separate entities and maintain separate finances.  

    Keota moved for summary judgment. * * * 

   The plaintiffs resisted the motion by pointing to allegations in their petition indicating Keota participated in the claims of wrongdoing through the management decisions it made in consumer safety matters. For example, plaintiffs claimed Keota, through Hopscheidt, was negligent in failing to provide proper warnings to propane users, including the failure to warn users to install a gas detector, and to properly design the odorant added to the propane. * * *

   The district court granted summary judgment for Keota. It found plaintiffs failed to produce any facts to show that Keota engaged in conduct separate from its duties as director or manager of Double Circle. Consequently, it concluded Keota was protected as a matter of law from personal liability for claims of wrongful conduct attributable to Double Circle. * * *

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   Plaintiffs filed their notice of appeal from the summary judgment. * * * They claimed the district court erred by finding that Keota was insulated from liability as a matter of law. * * *

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   The limited liability company, ‘‘LLC’’ as it is now known, is a hybrid business entity that is considered to have the attributes of a partnership for federal income tax purposes and the limited liability protections of a corporation. [Citation.] As such, it provides for the operational advantages of a partnership by allowing the owners, called members, to participate in the management of the business. [Citation.] Yet, the members and managers are protected from liability in the same manner shareholders, officers, and directors of a corporation are protected. [Citation.] 

   The LLC * * * has now been adopted by statute in every state in the nation. [Citation.] Iowa joined the trend in 1992 with the passage of the Iowa Limited Liability Company Act (ILLCA). [Citation.] The ILLCA, among other features, permits the owners or members to centralize management in one or more managers or reserve all management powers to themselves. [Citations.]

   Although the tax treatment of an LLC has been largely resolved, the contours of the limited liability of an LLC are less certain. [Citation.] Only a few courts have specifically addressed the issue of tort liability. * * * 

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   The[se] rules of liability derived from [the ILLCA] have been summarized as follows:

Sections * * * of the Act generally provide that a member or manager of a limited liability company is not personally liable for acts or debts of the company solely by reason of being a member or manager, except in the following situations: (1) the ILLCA expressly provides for the person’s liability; (2) the articles of organization provide for the person’s liability; (3) the person has agreed in writing to be personally liable; (4) the person participates in tortious conduct; or (5) a shareholder of a corporation would be personally liable in the same situation, except that the failure to hold meetings and related formalities shall not be considered. 

 [Citation.] 

   * * * While liability of members and managers is limited, the statute clearly imposes liability when they participate in tortious conduct. [Citation.] This approach is compatible with the longstanding approach to liability in corporate settings, where, under general agency principles, corporate officers and directors can be liable for their torts even when committed in their capacity as an officer. [Citations.] * * *

   Keota suggests that liability of an LLC member or manager for tortious conduct is limited to conduct committed outside the member or manager role. Yet, this approach is contrary to the corporate model and agency principles upon which the liability of LLC members and managers is based, and cannot be found in the language of the statute. We acknowledge that the ‘‘participation in tortious conduct’’ standard would not impose tort liability on a manager for merely performing a general administrative duty. [Citations.] There must be some participation. [Citation.] The participation standard is consistent with the principle that members or managers are not liable based only on their status as members or managers. [Citation.] Instead, liability is derived from individual activities. Yet, a manager who takes part in the commission of a tort is liable even when the manager acts on behalf of a corporation. [Citation.] The ILLCA does not insulate a manager from liability for participation in tortious conduct merely because the conduct occurs within the scope and role as a manager. * * * The limit on liability created for members and managers of LLCs in [citation] means members and managers are not liable for company torts ‘‘solely by reason of being a member or manager’’ of an LLC. [Citation.] The phrase ‘‘solely by reason of’’ refers to liability based upon membership or management status. It does not distinguish between conduct of a member or manager that may be separate and independent from the member or management role. Thus, it is not inconsistent to protect a member or manager from vicarious liability, while imposing liability when the member or manager participates in a tort. Liability of members of an LLC is limited, but not to the extent claimed by Keota. 

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   We conclude that Keota is not protected from liability if it participated in tortious conduct in performing its duties as manager of Double Circle. Consequently, the district court improperly granted summary judgment based on the limited liability provisions of [citation]. A trial is necessary to develop the facts relating to allegations of Keota’s participation in the alleged torts.

   We reverse the summary judgment ruling of the district court on the issue of liability under [citation], and remand for further proceedings.