I was able to scan the first few pages of the book “A Smart & Practical Guide for New Entrepreneurs” (Marlo Sanchez , New Edition), which reflects this banner “#1 Bestseller for Filipino Entrepreneurs”. I got stuck in pages 14 and 15, containing a discussion on the “Legal Types of Organizations”, i.e., Sole Proprietorship, Partnership and Corporation.
The book states that in partnerships, “[i]n case of bankruptcy and only one partner has assets to satisfy the business liabilities, then creditors will attach all personal assets of that one partner.” There is, however, a limited partnership, wherein the liability of the limited partner does not extend to his personal properties.
The book also states that a corporation “[i]s owned by at least two persons (but generally by several persons), each one limiting his/her risk based on the amount of his/her contribution to the enterprise. Your personal assets cannot be attached to satisfy the corporation’s liabilities.” However, the Corporation Code (Sec. 10) provides that a corporation must be composed of at least five persons, technically called “incorporators”. As to personal liability, maybe it’s helpful to state that personal assets cannot generally be attached to satisfy the corporation’s liabilities, because in certain cases (piercing the corporate veil, for example), the responsible members may be held personally liable.
These are constructive notes; nothing more. This is not a book review because I didn’t finish reading it (seems like an easy-to-read book for budding entrepreneurs). In the meantime, go out and make your first million.