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Limited Liability Partnerships

Many doctors, lawyers, and other professionals obtain insurance against malpractice and other types of litigation because large and sometimes frivolous claims are a daily occurrence in their industries. But relying strictly on insurance for protection is a significant mistake in today's litigious society where any professional can be exposed to liability from a number of causes. The need for professionals to organize and their assets is as essential as that of any commercial business or family with wealth concerns. The limited liability partnership—a special type of partnership created for those engaged in professional occupations—is an ideal format to protect doctors, lawyers, dentists, architects, accountants and other licensed professionals.

The LLP closely resembles the limited partnership however there are important differences. The LLP protects the professional partner from debts incurred by the practice as well as claims resulting from the malpractice of any other partner but it does not protect the professional partner from personal claims resulting from their own malpractice. Additionally, LLP assets cannot be seized by a professional partner's personal creditors except when the negligent partner was acting on behalf of the LLP as its principal. Furthermore, the professional partner's personal creditors can easily liquidate its interest in LLP because ownership interest in this type of partnership must typically be owned by professionals from within that specific field. This makes the LLP an excellent option when professionals desire to participate in management of the practice while continuing to insulate their personal assets from the liabilities of the partnership.


The best defense is a good offense.