THE LIMITS OF INTERPOSING A LIMITED LIABILITY ENTITY AS THE GENERAL PARTNER OF A LIMITED PARTNERSHIP IN DELAWARE LAW

On 11 August, an article from Well, Gotshal & Manges LLP in the US is concerned with potential personal liability of those involved in a Delaware limited partnership.  It refers to a 30-year-pld case which meant that the individual directors and controlling owners of a corporate general partner of a limited partnership owe direct fiduciary duties to the limited partners of the limited partnership. In other words, it explains, making a limited liability company the general partner of a limited partnership does not in any way limit or shield the directors or controlling owners of that company (as the general partner) from claims for breach of fiduciary duty by the limited partners.  It says that a recent case has reaffirmed the principle and is a good reminder of one of the limits of the statutory liability shield available through the formation of a limited liability entity.

https://www.jdsupra.com/legalnews/the-limits-of-interposing-a-limited-62838/

Author: raytodd2017

Chartered Legal Executive and former senior manager with Isle of Man Customs and Excise, where I was (amongst other things) Sanctions Officer (for UN/EU sanctions), Export Licensing Officer and Manager of the Legal-Library & Collectorate Support Section

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