limited liability

American  

noun

1. a liability restricted by law or contract, as the liability of owners of shares in a corporation or limited company, or that of a special partner.

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limited liability British  

noun

1. liability restricted to the unpaid portion (if any) of the par value of the shares of a limited company. It is a feature of share ownership

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limited liability Cultural  

1. A fundamental feature of corporations, whereby investors are liable only up to the amount of their investment.

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This principle is important for failing corporations because it holds that only the assets of the corporation, not the personal assets of its owners, can be liquidated (see liquidation) to cover the corporation's debts.

Etymology

Origin of limited liability

First recorded in 1850–55

Example Sentences

Property records show that the unit is still registered to the limited liability company that Jackman and Furness used when they purchased the home in 2008.

From MarketWatch • Apr. 6, 2026

Bohm alleges that his parents used his cash from the four limited liability companies to pay their expenses.

From Los Angeles Times • Mar. 27, 2026

They use trusts and limited liability companies and put their money into private investments that aren’t accessible to the typical person.

From The Wall Street Journal • Feb. 11, 2026

According to World Liberty’s website, a limited liability company affiliated with Donald Trump and “certain of his family members” owns about 38% of World Liberty’s holding company.

From Barron's • Nov. 25, 2025

Much of history revolves around this question: how does one convince millions of people to believe particular stories about gods, or nations, or limited liability companies?

From "Sapiens: A Brief History of Humankind" by Yuval Noah Harari