Definition
In law, "companies" is the plural of "company" — a broad term for any association of persons organized to carry on a business or enterprise for profit. The term is not a precise legal category but rather a general descriptor that encompasses several distinct organizational forms:
1. CORPORATION: A legal entity created by statute, with a separate legal personality, limited liability for shareholders, centralized management through a board of directors, and shares of transferable stock. In most modern usage, "company" and "corporation" are used interchangeably in commercial contexts.
2. PARTNERSHIP (GENERAL OR LIMITED): An association of two or more persons carrying on business together. In historical usage and in some jurisdictions, unincorporated trading associations were commonly called "companies" before the modern corporate form was standardized.
3. BUSINESS TRUST (MASSACHUSETTS TRUST): A voluntary association organized under a written declaration of trust, in which trustees hold and manage property for the benefit of certificate holders (beneficiaries). Trustees occupy the functional role of directors; beneficiaries occupy the functional role of shareholders. This form was prominent in Massachusetts and other states in the late nineteenth and early twentieth centuries.
4. LIMITED LIABILITY COMPANY (LLC): A modern hybrid entity combining corporate limited liability with partnership-style pass-through taxation. In many jurisdictions outside the United States, "company" (or "limited company") is the standard term for what Americans call a corporation.
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Common Language
Modern common usage (Wiktionary): As a standalone term, "companies" is simply the plural of "company," meaning businesses or groups of people working together toward a common purpose.
Historical common usage (Webster's 1913): A company was "an association of persons for the purpose of carrying on some enterprise or business; a corporation; a firm."
The gap between common and legal meaning is one of precision: in ordinary speech, "company" signals any business organization. In law, the term's significance lies in which specific organizational form is intended. Different forms carry radically different consequences for liability, taxation, governance, and regulatory treatment. The word itself resolves nothing; the governing instrument, statute, and jurisdiction determine everything.
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Common Confusion
COMPANY vs. CORPORATION: Outside the United States, "company" (particularly "limited company" or "company limited by shares") is the standard term for an incorporated entity. In U.S. practice, "corporation" is more precise, while "company" may describe incorporated or unincorporated entities alike. Researchers working across jurisdictions must not assume that "company" implies incorporation.
BUSINESS TRUST vs. CORPORATION: The Bouvier entry highlights a historically important distinction. Business trusts (Massachusetts trusts) were structured to avoid corporate taxation and some regulatory requirements. Courts and legislatures spent decades resolving whether they were truly trusts, partnerships, or corporations for tax and liability purposes. Sources from the early twentieth century using "companies" in connection with trust instruments may be describing this specific form — not a corporation.
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Why It Matters in Research
The term "companies" in legal sources is a moving target. Before the widespread adoption of general incorporation statutes in the mid-nineteenth century, "company" frequently described unincorporated associations, joint-stock companies, or business trusts — entities with no single governing statute and uncertain liability rules. Researchers reading nineteenth-century cases or treatises must be alert to which organizational form is actually at issue.
The Bouvier excerpt specifically addresses the business trust or "Massachusetts trust" — a form that flourished between roughly 1880 and 1940 and generated its own substantial body of case law on whether trustees and beneficiaries faced personal liability and whether the entity would be taxed as a corporation. This form appears with some frequency in early twentieth-century legal materials under headings like "voluntary associations," "declaration of trust," or "common law trusts," in addition to "companies."
For regulatory research, the word "company" carries statutory definitions that vary by context. Under the Investment Company Act of 1940, "investment company" has a specific statutory meaning that excludes many entities that ordinary usage would call investment companies. Under the Bank Holding Company Act, "bank holding company" is a defined term triggering Federal Reserve oversight. Neither definition tracks ordinary usage of "company."
Jurisdictional variation is also significant: in England and Commonwealth jurisdictions, "company" is essentially synonymous with "incorporated entity," and the Companies Acts (from 1844 through the current Companies Act 2006) form the backbone of corporate law. U.K. and Commonwealth sources indexed under "companies" will be largely inapplicable to U.S. unincorporated association questions.
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Historical Dictionary Support
Bouvier's Law Dictionary defines "companies" specifically in the context of the Massachusetts business trust, quoting Massachusetts Acts and Resolves 1911. The entry maps the trust structure onto corporate vocabulary — trustees as directors, beneficiaries as stockholders, declaration of trust as certificate of incorporation — which reflects the practical reality that courts and legislatures needed to decide how these hybrid entities would be treated. Bouvier's framing is useful precisely because it signals that in early twentieth-century legal discourse, "companies" organized as trusts were a recognized and distinct category, not merely informally organized businesses. What the historical dictionaries largely miss is the later twentieth-century proliferation of distinct statutory forms — LLCs, limited liability partnerships, S-corporations — that have since absorbed much of the functional role that business trusts once occupied.
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Jurisdictional Note
In the United Kingdom and most Commonwealth jurisdictions, "company" means an incorporated entity registered under companies legislation; the concept of an unincorporated "company" is largely a historical artifact. In the United States, "company" remains a general term covering incorporated and unincorporated forms alike. Researchers using cross-jurisdictional sources must treat the word as jurisdiction-specific.
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Encyclopedia Cross-Reference
The Law Mind Business Organizations & Corporate Law Encyclopedia:
— Special Topics: Investment Companies and the Investment Company Act of 1940
— Banking: Bank Holding Company Act and Financial Holding Companies
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