Two partners of a business are sued by a customer because of damages caused by the business's product. The business is forced to pay the customer $100,000 dollars, but each partner only has to pay $50,000 dollars. What is this an example of?

Question

Shared liability

Expanded access to capital

Partner strife

Expanded input on decisions

Answer 1

This is an example of shared liability. In this scenario, both partners are responsible for the business's obligation to pay damages to the customer, and their individual financial responsibility is limited to a portion of the total amount owed.