limited liability

American  

noun

1. a liability restricted by law or contract, as the liability of owners of shares in a corporation or limited company, or that of a special partner.

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limited liability British  

noun

1. liability restricted to the unpaid portion (if any) of the par value of the shares of a limited company. It is a feature of share ownership

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limited liability Cultural  

1. A fundamental feature of corporations, whereby investors are liable only up to the amount of their investment.

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This principle is important for failing corporations because it holds that only the assets of the corporation, not the personal assets of its owners, can be liquidated (see liquidation) to cover the corporation's debts.

Etymology

Origin of limited liability

First recorded in 1850–55

Example Sentences

So far, of the 289 properties that have been sold, 168 were bought by limited liability investors and private equity firms, as opposed to 93 purchased by individuals, she said.

From Los Angeles Times

The couple are understood to have purchased the dwelling through an LLC, with the identity of the seller also hidden behind a limited liability company.

From MarketWatch

Government officials typically have limited liability in fires.

From Los Angeles Times

David Levine, a professor of law at UC San Francisco, said Wednesday’s arrest ultimately didn’t seem to change the limited liability that public officials have in a fire through government immunity.

From Los Angeles Times

That was a limited liability company that partnered with the charity to offer jobs to people in Uganda, mostly to handle back-office work for U.S. companies, including the collection of past-due invoices.

From The Wall Street Journal