Jointly and Severally

DEFINITION of 'Jointly and Severally'

1. A legal term describing a partnership in which individual decisions are bound to all parties involved and thus undivided.

2. A term used in underwriting syndicates to refer to the distinct responsibility of individual companies to sell a certain portion of unsold new issue.

BREAKING DOWN 'Jointly and Severally'

1. When an investor authorizes power of attorney to two separate lawyers jointly and severally, both lawyers can make binding decisions without the approval of the other lawyer.

2. For example, an underwriter who has jointly and severally agreed to a 30% stake in the sale of a new issue must sell 30% of any remaining unsold portion, even if that underwriter has already sold more than this amount in the initial sale. All members of the syndicate are responsible for any leftover shares.

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