LIMITEDLIABILITY

Limited liability

Limited liability is where a person's financial liability is limited to a fixed sum, most commonly the value of a person's investment in a company or partnership. If a company with limited liability is sued, then the plaintiffs are suing the company, not its owners or investors. A shareholder in a limited company is not personally liable for any of the debts of the company, other than for the value of their investment in that company. This usually takes the form of that person's dividends in the company being zero, since the company has no profits to allocate. The same is true for the members of a limited liability partnership and the limited partners in a limited ...

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limited liability

Noun

  1. The liability of an owner or a partner of a company for no more capital than they have invested.


The above text is a snippet from Wiktionary: limited liability
and as such is available under the Creative Commons Attribution/Share-Alike License.

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