Differences between companies and partnerships are;-
- Legal status; a company has legal personality from that of the members. A partnership being a relationship is not a person in the eyes of the law & is merely made up to a collection of individuals.
- Number of Members; the maximum number of partners in a firm is 20 while in a company the maximum is 50 for a private & with no upper limit for public companies.
- Regulating Acts; a company is regulated the companies Act while a partnership is governed the partnership Act.
- Transferability of interests or shares; shares in a company are freely transferable unless the articles otherwise provide.
- Capacity to sue and be sued; A company may sue or be sued in its own name and liable for its own wrongs. A partnership can only sue or be sued in the names of partners as it is not legal entity.
- Liability of members; the liability of members of a company is limited whereas partners unlimited to contribute towards partnership debts and liabilities.
- Perpetual succession; in a company the death of a member does not affect its life, but in a partnership the death of a partners may automatically lead to dissolution of the firm.