LIMITED PARTNERSHIPS AND THE CONTROL PROHIBITION: ASSESSING THE LIABILITY OF LIMITED PARTNERS
AbstractOne of the principal issues associated with the use of the limited partnership is the extent to which limited partners are insulated from liability for the obligations of the partnership. Most Canadian statutes authorizing the use of limited partnerships provide that limited partners who participate in the "control" or "management" of the partnership business will lose their limited liability. The author discusses the limited and relatively restrictive Canadian case law and academic commentary concerning the so-called "control prohibition" and suggests that the adoption of a more expansive interpretation of the permissible scope for participation by limited partners in the conduct of the business of the limited partnership is warranted.
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