CALGARY LIMITED LIABILITY PARTNERSHIP LAWYER
Contact Neufeld Legal PC at 403-400-4092 or Chris@NeufeldLegal.com
A Limited Liability Partnership (LLP) is a specific type of partnership structure primarily available to professionals in regulated fields, which provides some of the benefits of a general partnership, while providing an all important degree of limited liability as to the other professionals' personal negligence, wrongful acts, omissions, malpractice and misconduct. In Alberta, only specific regulated professionals are eligible to engage in their professional capacity in partnership under the construct of a limited liability partnership (e.g., accountants, lawyers, doctors/physicians, dentists, chiropractors, optometrists).
A. Limited Liability - Protection of Personal Assets
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Whereas, in a general partnership, all partners are jointly and severally liable for the debts and obligations of the business, such that if one partner commits an act of negligence or the partnership incurs a significant debt, all partners' personal assets could be at risk; in a limited liability partnership, each partner is personally liable for their own negligence, wrongful acts, omissions, malpractice, or misconduct, while being protected from the other partner's personal negligence, wrongful acts, omissions, malpractice and misconduction.
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A limited liability partnership thereby protects a non-negligent partner's personal assets from the debts and liabilities arising from the negligence, wrongful acts, omissions, malpractice, or misconduct of another partner. As such, the limited liability partnership structure provides a layer of legal protection for innocent partners from the professional mistakes of their colleagues.
B. LLPs Encourage Collaboration
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By mitigating the risk of unlimited liability, limited liability partnerships can encourage professionals to form partnerships, pool resources, and collaborate on projects. This can lead to more comprehensive services for clients and greater efficiency within the limited liability partnership.
C. Standard for Professionals
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For certain professions in Alberta (e.g., accountants, lawyers, doctors/physicians, dentists, chiropractors, optometrists), the limited liability partnership (LLP) structure has become a standard and recognized way to operate. Each profession's regulatory body (e.g., College of Physicians & Surgeons of Alberta, College of Dental Surgeons of Alberta, College of Chiropractors of Alberta, Alberta College of Optometrists, CPA Alberta, Law Society of Alberta) has specific procedures and requirements for registering as a limited liability partnership (LLP).
D. Flexibility of a Partnership
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While offering limited liability, a limited liability partnership (LLP) structure retains the operational flexibility of a partnership. Partners can still be actively involved in the management of the business, unlike in some other structures where management control might be restricted to maintain limited liability (e.g., limited partners in a limited partnership).
Providing strategic legal advice and direction to professionals looking to engage in partnership as a limited liability partnership (LLP) in Alberta, from partnership formation to internal governance to contracts and business transactions to dispute resolution. Contact our law firm at Chris@NeufeldLegal.com or 403-400-4092 to schedule a confidential initial consultation for your limited liability partnership.