Limited Liability Partnerships Introduced

Limited liability partnerships (LLPs) are coming to Nova Scotia. Legislation introducing them to the province was brought forward today, Nov. 1, by Justice Minister Michael Baker. The legislation will offer limited protection to individuals from liability caused by the negligence or misconduct of their professional partners.

"This is about creating a climate for business," said Mr. Baker. "The personal assets of an individual should not be at risk because of the wrongdoing of another. This legislation addresses the issue while protecting the consumer."

The Partnership Act will be expanded to include limited liability partnerships for certain professions and allows government (through regulation) to set the minimum amount of liability insurance that these partnerships must maintain.

Currently, partners are jointly liable for the liabilities of the partnership -- which could expose the personal assets of all partners, as well as the assets of the partnership. This legislation will provide limited protection to partners as long as they were unaware of the negligent or wrongful act and were not acting in a supervisory role over those who committed the wrongdoing.

A Nova Scotia limited liability partnership must have a registered office in the province and be accessible to the public during normal business hours.

"By having the power to control the amount of liability coverage required, we can ensure that any loss will be covered, thereby protecting the consumer," said Mr. Baker.

Similar legislation exists in Ontario, Alberta, Manitoba, Quebec and Saskatchewan.