Unincorporated associations
Unincorporated associations

The following Corporate practice note provides comprehensive and up to date legal information covering:

  • Unincorporated associations
  • What is an unincorporated association?
  • Advantages and disadvantages
  • Advantages
  • Disadvantages
  • Why operate as an unincorporated association?
  • Legal framework
  • Structure of an unincorporated association
  • Requirement to report political activities

What is an unincorporated association?

An unincorporated association:

  1. is an organisation formed when two or more persons (the members) carry on activities together for a common purpose

  2. does not operate for the purpose of generating profit (in fact, if two or more persons carry on business for the purpose of making a profit, a partnership will be established and partnership law will apply—see Practice Note: The nature of a general partnership and its legal framework)

  3. is not a separate legal entity from its members and officers, which means that the officers and members are personally liable for the debts and obligations of the association, and

  4. may not enter into contracts, own assets, sue or be sued in its own name

Advantages and disadvantages

Advantages

The key advantages of operating an organisation using an unincorporated association are:

  1. flexibility—the association can create its own rules governing its operation and management and is not subject to any rigid regulation or other controls

  2. privacy—the association is not required to file accounts or publicly disclose its governing document or any other information about it, so it can keep its financial and operational affairs totally private (although there are some reporting requirements if the association operates for the purpose of supporting political activities—see Requirement to report political activities), and

  3. changing membership—the membership of associations and clubs is often very fluid and fast changing. The

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