Printer Friendly
Dictionary, Encyclopedia and Thesaurus - The Free Dictionary
1,781,176,119 visitors served.
forum mailing list For webmasters
?
New: Language forums
Dictionary/
thesaurus
Medical
dictionary
Legal
dictionary
Financial
dictionary
Acronyms
 
Idioms
Encyclopedia
Wikipedia
encyclopedia
?

Unlimited Liability

   Also found in: Dictionary/thesaurus, Legal, Encyclopedia, Wikipedia, Hutchinson 0.02 sec.
Unlimited liability
Full liability for the debt and other obligations of a legal entity. The general partners of a partnership have unlimited liability.

unlimited liability
The liability of the owner of a business for all the obligations of the business. An owner's personal assets can be seized if the business's assets are insufficient to satisfy claims against it. The placement of personal assets at risk is a great disadvantage of proprietorships and general partnerships. The ability to limit the amount of liability to which an owner is subject is a major reason for the formation of corporations and limited partnerships. Compare limited liability.

Unlimited Liability
The responsibility of one or more owners of a business for the total amount of debt and other liabilities that the business accrues, regardless of how much the owner(s) have personally invested. That is, suppose two persons form a general partnership and each invests $10,000. If the business later accrues $100,000 in liabilities, both partners are equally responsible for the $80,000 over and above what they have invested. If the business defaults, the personal assets of the partners may be seized to repay debts. Unlimited liability contrasts with limited liability, which limits the amount one can lose on an investment to the total amount invested. Unlimited liability is most common in general partnerships, sole proprietorships, and for general partners in limited partnerships.


How to thank TFD for its existence? Tell a friend about us, add a link to this page, add the site to iGoogle, or visit webmaster's page for free fun content.
?Page tools
Printer friendly
Cite / link
Email
Feedback
Add definition
? Mentioned in
 
Financial browser? ? Full browser
 
 
Financial Dictionary
?

Disclaimer | Privacy policy | Feedback | Copyright © 2009 Farlex, Inc.
All content on this website, including dictionary, thesaurus, literature, geography, and other reference data is for informational purposes only. This information should not be considered complete, up to date, and is not intended to be used in place of a visit, consultation, or advice of a legal, medical, or any other professional. Terms of Use.