When two or more persons, whether individuals or corporations, carry on business
together with a view to profit, the relationship is called a partnership and the members of the partnership are called partners. A partnership is like a sole proprietorship in that it is relatively inexpensive to set up, there are few legal formalities required to create it and the partners carry on the business themselves directly, Furthermore, the partnership is not a legal entity separate from its partners.
In a general partnership the liability of each partner for the debts and other obligations of the partnership is unlimited. This is in contrast to limited partnerships. In a limited partnership there is one partner known as the “general partner” whose liability is unlimited, and one or more “limited partners” whose liability is limited to the
amount they have contributed or agreed to contribute to the partnership business, as stated in the record of limited partners. LLPs are essentially a cross between general partnerships and limited partnerships and are typically used by groups of professionals who are not permitted to incorporate and obtain full limited liability. While the assets
of the LLP are available to satisfy debts and claims against it, partners are liable only for their own negligence, or the negligence of employees under their direct supervision and control. A judgement against an LLP for negligence is not enforceable against the other partners. However, similarly to general partnerships, all partners in an LLP remain liable for all of the obligations of the LLP other than negligence.
by Ryan Carson