Unincorporated Associations Framework Notes

1. Is it UA?

1. Stipulated expressly in the problem conclusive

2. Not stipulated ask

1. Owned by individual/company = legal personality (company law)

2. 2 or more persons bound together for one or more common purposes w/mutual rights & obligations in an organisation which has rules governing the use of property, and which can be joined/left at will (Lawton LJ in Burrell) = UA

2. Has it dissolved + when?

• Assets can only be distributed if dissolved!

• Do facts put together carry sufficient conviction that association is at an end & not merely dormant?

1. not dissolved just b/c impractical to operate (ReWilliams Delby Sick Fund)

2. need positive acts + inactivity (mere inactivity will suffice where it’s prolonged) (ReGNKSportsClub)

• 4 ways in which can dissolve (Brightman J)

1. In acc. w/rules

2. By agreement of all interested persons

3. Court order

4. Substratum upon which it was founded has gone (i.e. purpose no longer effective)

• watch out for ambiguity in purpose – e.g. to reduce noise in the airport: depends on whether a particular airport (which has closed, hence purpose no longer effective) or any airport

• Only one person left = dissolved b/c can’t associate w/himself assets are divided as follows:

1. Originally, bona vacantia (ReBucks)

2. Currently – to remaining members b/c contract governing the use of property no longer operative, hence can severe their share (Hanchett Stamford v AG)

• Date of dissolution – if unclear, court must pick a reasonable date

• If result in the end is unfair, try tweaking it

• If few possibilities, analyse all

3. Has each donation been made validly?

• Important b/c determines whether goes back on RT or can be divided amongst members in acc. w/rules

• UA can’t own payments made b/c not a legal person must construe as one of the following (Leahy v AG of New South Wales)

1. A gift to existing members beneficially

• Problematic b/c each can severe their share immediately, contravening donor’s intent

2. A gift to existing & future members beneficially

• Likely to fail b/c of perpetuity

3. Absolute gift to members (usually, for one (Treasurer) to hold on trust for others b/c easier + rules limiting no of people who can hold certain types of interests; e.g. s? LPA 1925) which takes effect as accretion to existing funds under contract

• Requirements

1. Beneficial transfer

2. Existence of contract governing the holding/use of property

• If transfer is made w/some qualification as to use (e.g. to LawSoc for purposes of mooting ReLipinski

• Theoretical problems

1. ensuring Treasurer holds on self-imposed trust depends on contract governing the use & holding of property

• Downside – donor doesn’t have much impact

2. formalities – disposition of equitable interest when old members leave & new join

• Penner – implied contractual right for Treasurer to vary membership – add & take away

3. shifting membership

4. contract “binds” property – not theoretically possible

• argue members are bound by contract in their use of property instead?

5. members can waive/vary the contract by agreement

4. Purpose trust w/ascertainable beneficiaries (ReBowes type trust as used in ReLipinski)

• Oliver J (ReLipinski)

1. Donor’s intent in identifying the purpose was to benefit members (e.g. for Maccabi association for construction/maintenance of new buildings) = valid

2. Donor’s intent was clearly not to confer any particular benefit on anyone/to benefit ascertainable group of people (e.g. general purposes of association) = fails (can’t make a gift to object or purpose – Neville Estates v Madden)

• Key question: end enforcement/interest in enforcement

• How to determine?

1. Default position – contract holding theory (ReBucks)

2. Donor can choose

• usually, won’t say so explicitly

3. Donation is genuinely intended for benefit of the members – apply contract...

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