Unlimited Liability Corporations(ULC)

[chris009]

I was actually searching for information on LLC's in Alberta, and up came the Unlimited Liability Corporations legal status for a business. I don't get it. Why would anyone have a business with this legal status? It's supposed to be very popular with U.S. investors in Alberta. I don't get why. I'm assuming it's name is accurate of the legal status, so why would anyone invest in a company that if it got sued, stock holder assets would be completely liable.

Can someone help shed some light on this?

[akula]

I was actually searching for information on LLC's in Alberta, and up came the Unlimited Liability Corporations legal status for a business. I don't get it. Why would anyone have a business with this legal status? It's supposed to be very popular with U.S. investors in Alberta. I don't get why. I'm assuming it's name is accurate of the legal status, so why would anyone invest in a company that if it got sued, stock holder assets would be completely liable.

Can someone help shed some light on this?

these structures are used in professional circles
lawyers usually work in partnerships and other setups with unlimited liability.
the reason is that of public policy - it's important for society that doctors, lawyers, accountants and other professionals in society are tasked with unlimited liability..because if they didn't, that may create dangers...and in return for accepting higher levels of liability, people in these professions receive certain benefits from society

[jasaunders]

As an addition, professionals in these fields are personally open to risk from their structure, but this is why they purchase liability insurance which covers their personal liability for a certain amount. ie. A doctor has malpractice insurance because they are personally liable if they were to be sued.