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Unlimited Liability In The Modern Context: An Examination Of Shareholder Liability In Nova Scotia Unlimited Liability Companies, Sarah P. Bradley
Unlimited Liability In The Modern Context: An Examination Of Shareholder Liability In Nova Scotia Unlimited Liability Companies, Sarah P. Bradley
Dalhousie Law Journal
For over 30 years, unlimited liability companies have been ubiquitous in USCanadian M&A transactions. Typically interposed between a US parent company and a Canadian operating company, these entities quietly function to make such structures more tax efficient. They are facilitated by Nova Scotia's venerable Companies Act, which has allowed for the incorporation of corporations with unlimited liability for over a hundred years. Unlimited liability of shareholders is the singular defining characteristic of the ULC, but the precise nature of ULC shareholder liability was apparently regarded as something of a technicality and rarely, if ever, closely examined in the professional or …
Shareholder Liability In Nova Scotia Unlimited Companies, Mohamed F. Khimji
Shareholder Liability In Nova Scotia Unlimited Companies, Mohamed F. Khimji
Dalhousie Law Journal
Unlimited Companies incorporated under the Nova Scotia Companies Act (NSULCs) have, in recent decades, become recognized as tax efficient forms of business organizations. NSULCs differ from conventional business corporations in that their shareholders are exposed to liability for corporate obligations under the enabling legislation. This paper attempts to provide an analysis of the precise nature of unlimited liability faced by shareholders in such entities in response to recent bankruptcy litigation in the U.S. that raised the issue of the relationship between a shareholder's liability for a debt of the firm under the enabling legislation and under a contractual guarantee provided …