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Partners in a Partnership Are Exposed to Unlimited Liability

question 29

Essay

Partners in a partnership are exposed to unlimited liability. In addition to having their own personal assets available to satisfy creditors they also can become liable for the actions of other partners. Give an example which illustrates this possibility.


Definitions:

Punitive Damages

Punitive damages are compensation awarded in addition to actual damages, intended to punish the defendant for egregious wrongdoing and deter similar future actions.

Negligence

A failure to exercise appropriate and/or ethical ruled care expected to be exercised amongst specified circumstances, leading to harm or damage.

Reasonable Person

A legal standard used to determine how an average person would responsibly act under similar circumstances.

Society Expect

The anticipations or beliefs regarding behavior, norms, or achievements considered standard or desirable by a community or group.

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