1. In
business,
liability is used to refer to how financially
liable you are for the actions of a
company if it becomes
insolvent. In the case of a
sole trader, his personal possessions are at risk when it comes to paying debts. This is called
unlimited liability.
One of the advantages of been a plc or ltd however, is limited liability. Shareholders in a large company are only liable for the capital they invested, and nothing else. The company is a seperate legal entity to the owners, and the debts of one are not the debts of the other.
2. Common usage: "You're a liability," meaning "You cause numerous problems."