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Difficulty: EasyPartnership: Types, Deed, Rights, and Dissolution

In a limited partnership operating under commercial legal regulations, which of the following statements correctly describes the liability status of the partners?

  1. At least one partner must have unlimited liability for the debts of the firm.Answer
  2. B
    All partners enjoy limited liability up to the amount of their capital contribution.
  3. C
    Limited partners bear unlimited personal liability while active partners have limited liability.
  4. D
    All partners are completely exempted from personal liabilities and business debts.

Answer

At least one partner must have unlimited liability for the debts of the firm.
Under commercial law, a limited partnership must consist of one or more general partners who have unlimited liability for the debts of the business, alongside limited partners whose liability is restricted to their capital contributions.

Step-by-Step Solution

1
Identify the key legal requirement defining a limited partnership.
Distinguish between limited partners and general partners.
A limited partnership is created to allow passive investors to limit their financial risk while retaining at least one general partner to handle full liability.
2
Evaluate the legal liability obligation under commercial partnership law.
Confirm that at least one partner must retain unlimited liability.
Creditors must have recourse to at least one partner's personal assets if the business assets are insufficient to cover debts.

Key Concept

Liability structure of a limited partnership
Estimated Time:45s
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Topics

Partnership: Types, Deed, Rights, and Dissolution

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