MRL2601
ASSIGNMENT 1 SEMESTER 1 2026
UNIQUE NO.
DUE DATE: 6 MARCH 2026
, Entrepreneurial Law - MRL2601
Question 1
1.1 Advise Ben on the difference between a partnership and a company
A partnership and a company are both forms of business enterprises, but they differ
significantly in their legal nature, formation, liability, and continuity.
A partnership is a contractual relationship between two or more persons who agree to
carry on a lawful business together with the aim of making a profit. It does not have a
separate legal personality from its partners. This means that the partnership and the
partners are regarded as one and the same in law. As a result, partners are personally
and jointly liable for the debts and obligations of the partnership. A partnership is
created through agreement and generally dissolves upon the death, insolvency, or
withdrawal of a partner unless otherwise agreed.
A company, on the other hand, is a separate legal person distinct from its
shareholders and directors, as established in Salomon v Salomon & Co Ltd. It is
incorporated in terms of the Companies Act 71 of 2008. Because of its separate legal
personality, a company can own property, enter into contracts, and sue or be sued in its
own name. Shareholders enjoy limited liability, meaning they are only liable for the
amount they invested in the company. A company also has perpetual succession,
meaning it continues to exist despite changes in ownership or management.
The key differences are that a partnership lacks legal personality and exposes partners
to unlimited personal liability, while a company has separate legal personality, limited
liability, and perpetual existence, making it more suitable for large-scale and
international business ventures such as aviation-related corporate law.
ASSIGNMENT 1 SEMESTER 1 2026
UNIQUE NO.
DUE DATE: 6 MARCH 2026
, Entrepreneurial Law - MRL2601
Question 1
1.1 Advise Ben on the difference between a partnership and a company
A partnership and a company are both forms of business enterprises, but they differ
significantly in their legal nature, formation, liability, and continuity.
A partnership is a contractual relationship between two or more persons who agree to
carry on a lawful business together with the aim of making a profit. It does not have a
separate legal personality from its partners. This means that the partnership and the
partners are regarded as one and the same in law. As a result, partners are personally
and jointly liable for the debts and obligations of the partnership. A partnership is
created through agreement and generally dissolves upon the death, insolvency, or
withdrawal of a partner unless otherwise agreed.
A company, on the other hand, is a separate legal person distinct from its
shareholders and directors, as established in Salomon v Salomon & Co Ltd. It is
incorporated in terms of the Companies Act 71 of 2008. Because of its separate legal
personality, a company can own property, enter into contracts, and sue or be sued in its
own name. Shareholders enjoy limited liability, meaning they are only liable for the
amount they invested in the company. A company also has perpetual succession,
meaning it continues to exist despite changes in ownership or management.
The key differences are that a partnership lacks legal personality and exposes partners
to unlimited personal liability, while a company has separate legal personality, limited
liability, and perpetual existence, making it more suitable for large-scale and
international business ventures such as aviation-related corporate law.
