The limited partnership (KG) in its various forms (especially the GmbH & Co. KG) is one of the most used and practically relevant forms of company. This is sometimes also due to the fact that the limited partnership enables its shareholders to limit liability as the only partnership. However, it is often overlooked that limited partners (= limited partners) are nevertheless liable in certain cases. Therefore, in the following article we deal with the basics of liability of limited partners.

1.1. Liability for corporate debts

One of the major differences between partnerships (GbR, OHG, KG) and corporations (GmbH, AG) is the personal liability of the shareholders. Thus, the partners of partnerships are personally liable for the fulfillment of the liabilities of the company. This also applies to the limited partner of a limited partnership. In principle, he is liable to the company’s creditors personally and directly (§§ 128, 161 paragraph 2 HGB), whereby the company’s creditors may choose whether they want to use the limited partnership or the limited partnership. In this context, there is no exclusion of this liability for corporate debts in the external relationship. Corresponding agreements between the company and the limited partner also have no influence on this. Of course, the limited partner is usually entitled to recourse against the company after the payment of company debts (§ 110 HGB). However, the successful assertion of the claim naturally depends on the liquidity situation of the limited partnership.

1.2. Scope of liability

In order to understand the limitation of liability of the limited partner, it is first necessary to separate the contribution to the limited partnership from the amount of liability to be entered in the commercial register. In this regard, the compulsory contribution agreed between the limited partnership and the limited partnership partner acts exclusively on an internal basis for the purpose of taking up his position as shareholder. Consequently, the Obligation gives rise to the limited partnership’s right against the limited partner to effect the contribution in the agreed amount.

The amount of liability to be entered in the commercial register must be strictly separated from this. Here, the liabilities amount has an external effect on the creditors of the limited partnership (§ 172 (1) HGB). According to §§ 171 (1) sentence 1, 172 HGB, the liability of the limited partner is limited to the amount of the liabilities entered in the commercial register. Therefore, for claims against the company exceeding this amount, the company creditors cannot make any claim against the limited partner. It should be noted that the amount of the liabilities does not necessarily have to correspond to the deposit amount agreed between the company and the limited partnership. In principle, it is therefore permissible to agree on individually different figures. However, in the absence of a corresponding explicit agreement in the articles of association, it is generally assumed that the liabilities amount corresponds to the contribution obligation.

1.3. Liability of the limited partner outside §§ 128, 161 paragraph 2 HGB

In addition to the liability of the limited partner for debts of the limited partnership described above, the limited partner may also be liable for other reasons. In this respect, for example, individual contractual agreements of the limited partner with company creditors (e.g. debt joining, guarantee) or fault-related liability due to unlawful acts come into consideration. With regard to each of these grounds of liability outside the liability for corporate debts, no limitation of liability occurs within the scope of § 171 (1) sentence 1 HGB.

2 Exemption of the limited partner from liability

2.1 Possibility of exemption

In addition to the limitation of liability according to the amount, the limited partner can also completely exempt himself from liability towards company creditors. This is because the liability obligation is waived by making the agreed contribution to the company. If there is a deviation from the obligation to pay and the amount of liabilities in the agreements of the company and the limited partner, the amount of the liabilities entered in the commercial register is decisive for the discharge of liability. If, in this case, the entered amount of liability should be smaller than the agreed amount, a deposit equal to the amount of liability is sufficient to exclude the liability of the limited partner in the external relationship. Conversely, the liability remains in the external relationship insofar as the amount liable is actually higher than the contribution to the company (for example, due to an overvaluation of contributions in kind or a set-off claim).

2.2. Impairment of the deposit

However, the limited partnership is only released from external liability by the provision of the agreed deposit, insofar as the value of the deposit corresponds to the value of the liabilities (depreciation). Whether the value of the deposit corresponds to the amount of liabilities entered in the commercial register is to be determined according to the objective time value at the time the deposit is made. A valuation deviating from the objective fair value of the subject-matter of the deposit on the basis of an agreement between the company and the limited partnership does not affect the stability of the deposit. In practice, this fact is particularly relevant in the case of deposits in kind or deposit offsets.

2.3. Resurgence of liability

However, the one-off value contribution does not in any way exempt the limited partner from any liability. If the limited partnership repays the amount of the contribution to the limited partnership owner, the limited partnership owner’s liability vis-à-vis the company creditors is restored (§ 172 (4) HGB). For example, a repayment of the contribution can be considered, among other things, in the case of certain activity remuneration of the limited partner by the GmbH or in the withdrawal of profit despite a negative capital account. However, it must be assessed in each specific individual case whether the operations concerned lead to a resurgence of the liability of the limited partner.

2.4 Burden of proof regime

Moreover, in the event of a legal dispute, the burden of proof lies with the limited partner in order to justify the discharge of liability.

If a limited partner participates in an existing limited partnership, he is liable, on the one hand, in accordance with the principles described above, for all corporate debts arising from that date. In addition, the limited partner is also liable for all liabilities of the limited partnership already established prior to its occurrence. However, in principle, the liability exemption described in the previous chapter also applies in connection with liability for old debts of the company. Furthermore, the company and the limited partner or limited partner and individual creditors of the company can also make individual agreements on a release of liability. Of course, however, such agreements apply exclusively in the relationship between the parties.

4. The liability of the retired limited partner (§ 160 HGB)

Finally, the limited partner is liable for certain old debts even after leaving the limited partnership. The condition is that the liabilities arose before his departure and are due within five years after his departure. In this case, the limited partner’s liability exemption shall remain insofar as he does not receive repayment of the contribution made by him from the limited partnership (for example, by a severance payment; see 2.3.). If the retired limited partner satisfies a company creditor, he is usually entitled to recourse against the company. However, it should be noted here that the rules regarding subsequent liability for limited partners of an investment KG in the sense of §§ 124 following, 149 following KAGB have no validity. In this particular context, the departure from the Investment KG puts an end to liability for corporate debts (see §§ 133 paragraph 2, 152 paragraph 6 KAGB).