What does "joint and several liabilities" mean for general partners?

"Joint and several liabilities" refers to a legal concept applicable in partnerships, particularly for general partners. This means that each partner is fully responsible for the entire debt of the partnership, not just a portion or share. If a partnership incurs debt, creditors can pursue any one partner for the total amount owed, regardless of that partner's individual share of the partnership or contribution. This scenario exposes each partner to greater risk, as they could end up bearing the entire financial burden of the partnership’s obligations if the other partners are unable to pay their share.

In contrast, the other options do not accurately describe "joint and several liabilities." One partner being solely responsible (the first option) diminishes the collective nature of the partnership obligation. The concept of sharing debts equally suggests that each partner would only be liable for their proportional share, which is not how joint and several liabilities operate. Lastly, the idea that liabilities are limited to the extent of their investments implies a form of limited liability, which is associated with structures like LLCs or corporations, and is not applicable to general partners who have unlimited liability. Therefore, the correct interpretation is that each partner under joint and several liabilities is indeed fully liable for the entire partnership debt.