On Denial Of Limited Liability In Limited Partnership

The first and foremost value of the legal system is to safeguard fairness and justice. when designing a legal system for fairness and justice which leads to "overkill", and make the other extreme lost its balance, then the value of fairness and justice of the system had not materialized. Limited liability and denial of limited liability conflicts in the pursuit of that value. The contradictions still exist when Limited liability was expend into LP from company, but few scholars advocate of limited liability partnership should be limited. In fact, it's doubtful how much the general partners of LP can satisfied the creditors of LP with their unlimited liability.it is even more unfair to creditors that the limited partner still undertake limited liability when it's his false to lead to loss. In view of this, we should properly deny the limited liability to attain the true fair , but our "Partnership Enterprise Law" is lack of relevant provisions to control the abuse of limited liability of the limited partner. The same situation can be found in the foreign legislation.In most of countries the control only exist in the area of company.That's to say,when a shareholder abuse his limited liability,the court will "Piercing the corporate veil" and order him to directly undertake the debt of LP. In fact, the one who enjoy limited liability can lead to such risk,it's same for a limited partner.But the law leaves blank in regulating a limited partner. In this vein, the paper is to study the theory about the denial of limited liability.The article is divided into the following sections:The first part describes the origins and development of a limited partnership to make it known roughly for readers,and lays the groundwork for the study of its liability.The second part introduces the form of liabilitys of LP in which limited liability is the norm,while the unlimited liability is an exception.It emphasizes the latter and points out that the current theory or legislative practice on denial of limited liability in LP is too narrow and a simple.The third Part illustrates the need to apply the theory about denial of limited liability.Through a comparative method as well as the analysis on limited partnership's own characteristics,we can know the drawbacks of limited liability will not elimination even if the field in which it exists has changed.The law should be consummated to control the risk in limited partnership .Part IV analyzes the condition of applying denial of limited liability in LP. Only when a system is operable can it get effect outcome, and the specific conditions for the application is a premise of a operable system. This chapter analyses the precondition, the main body element, the behaviour element, the subjective elements and results elements,at the mean time,it discusss and explains some specific problem involved in each element.Part V proposes some advices on improvement of denial of limited liability in our limited partnership.Through the comparison with the legislation on Disregard of Corporate Personality and with the advanced legislation on LP in foreign countries ,it points out some problems in our LP and proposes suggestions on amendments.The conclusion section summarizes the contents in whole paper and the author's opinion about the application of denial of limited liability in limited partnership.