Democratic Sentinel, Volume 12, Number 44, Rensselaer, Jasper County, 23 November 1888 — Meaning of the Word “Limited.” [ARTICLE]

Meaning of the Word “Limited.”

A subscriber asks for an explanation of the word “limited,” which lrequently follows ths'name of a corporation, as the “Sunrise Blacking Company, limited,” or “Smith & Jones, limited.” In the last case, as in the concern is a corporation, with shareholders, not on 3 of whom, possibly, is a Smith or a Jone?. The old principle of corporations create! by legislative act was that the entire property of every stockholder waslia de for the whole debts of the compaiy, as the whole propeit/ of every member of a general partnership is still liable for the debts of the firm. But this s /stem made every shareholder responsible lor bad management of which he might not be guilty, and deterred wealthy m:m from becoming interested in the shares of corporations. To remove this objection the principle of limited liability was introduced, and in order to notify the publ.c that only the separate property of the corporation was liable for the debts of the corporation the English law re juires that the word “limited” shall be uied in every case by the company. Most American corporations are constituted on the principle of limited liability, but few, if any, of the States enjoin companies to append the word limited to their corporate titles. The matter is so well understood in this country, indeed, that it is not necessary. The most noteworthy exception to the general rule is the case of the national banks, and even in this instance liability is limited to an amount equal to the par value of the shares. That is, if a national bank fails, each stockholder may not only lose what he has invested, but SIOO more for each share of stocks he holds, if so much is necessary to pay the debts of the 1 ank. Until within a few years all the Scottish banks were organized with unlimited liability, and when, eight or ten years ago, a Gla-gow bank failed, disastrously, there were cases of men who only owned a share or two, valued before the failure at not much more than a hundred dollars each, who were assessed thousands of pounds sterling, to meet the debts of the bank. Since that time the Scottish banks have been allowed to reorganize on a bas s of limited liability.— Youth’s Companion. Apologies for Christianity were addressed by Justin Martyr to the Emperor Antoninus Pius, about A. D. 164, Nineveh, the capital of the Assyrian Empire, was founded by Ashur about 2245 B. C.