Also known as: limited partner · LP
Written by attorneys · grounded in primary & secondary sources — see below
Persons who hold ownership interests in a limited partnership by agreement among the initial partners. They contribute capital without participating in management and incur no personal liability for partnership obligations solely by reason of their status.
Levi Lowe and Luna Lang agree to form a limited partnership to operate a shipping business. They select the name Lighthouse Shipping LP to comply with statutory naming requirements. The chosen designation satisfies the rule that the name must contain limited partnership or the abbreviation LP.
Liam Larson and Lars Lindstrom decide to create a limited partnership for energy investments. They agree that Lars will serve as a limited partner by contributing capital while remaining passive. Upon filing the certificate of limited partnership, Lars acquires that status under the formation agreement.
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Lena Lawson invests as a limited partner in Lone Peak Energy. When the partnership incurs a large equipment debt, creditors attempt to collect from Lena personally. The court rejects the claim because her status alone does not impose direct or indirect liability for partnership obligations.
Leo Lynch contributes funds to a limited partnership managed by an outside firm. After an audit reveals losses, Leo claims the auditors owed him a duty as a limited partner. The court examines whether his passive ownership interest creates the required relationship for third-party liability.
A person becomes a limited partner upon formation of the limited partnership as agreed among the persons that are to be the initial partners. The agreement determines the initial ownership interests without requiring additional formalities beyond the partnership documents.
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A limited partner is not personally liable for a debt, obligation, or other liability of the partnership solely by reason of being or acting as a limited partner. This protection holds even if the limited partner participates in management and control, and it applies regardless of partnership dissolution.
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The name of a limited partnership must contain the phrase limited partnership or the abbreviation LP or L.P. and may not contain the phrase limited liability limited partnership or the abbreviation LLLP or L.L.L.P.
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…LLC, an international private investment company. He is also the founder, Chairman and majority shareholder of M7 Aerospace LP, a privately held aerospace service, manufacturing and technology company; founder, Chairman and majority shareholder of Intercomp Technologies, LLC, a privately held business process…