LIABILITY OF PARTNERSHIP

Liability of Partnership

Liability of Partnership

In comparison to the corporation, the partnership had several limitations as noted by Cottrell in 1980 and Harris in 2000. First, the law restricted the number of partners and therefore the size of their personal wealth placed a limit on the amount of capital that the venture could mobilize. As a result, it was difficult to form businesses, like railways, that needed large amounts of capital using this framework. Second, partnership shares were not freely transferable; they could only be sold with the permission of all partners. Third, unlike corporations, partnerships were not immortal; when ...