Are you part of a small sports club or cultural group? If this group or community is engaging in non-commercial, small-scale and not-for-profit activities, you might consider setting up a legal entity. A common structure in these circumstances is incorporated associations. This article will answer some questions about incorporated associations in New South Wales.
1. What is an Incorporated Association?
Incorporated Associations are usually small community groups which allow the association to undertake the following actions:
- Open bank accounts;
- Enter into and enforce contracts;
- Hold property;
- Sue and be sued; and
- Continue its existence regardless of membership.
The easiest way to check if your association is incorporated is to conduct an ABN search (the Register should list the organisation as an “Other Incorporated Entity”. Alternatively, you can check NSW Fair Trading’s search tool or the ACNC register (if you are a charity).
2. What Rules Govern Incorporated Associations?
In New South Wales, the Associations Incorporation Act 2009 (NSW) governs what rights members have. Your organisation’s rules or constitution should detail the complaint and dispute resolution process.
3. Am I a Member of an Incorporated Association?
You will become a member of an incorporated association if your organisation approves your application under its constitution. If you are unsure, the Secretary has a duty to maintain the register of members. You can ask the Secretary of the organisation to allow you to inspect the member’s register.
4. What Rights Do Members Have?
As mentioned, your organisation’s constitution should outline your rights. If you don’t have a copy, you can access one by downloading it from the ACNC website if you are a charity or asking the Secretary of your organisation for a copy.
Your constitution should include the rights to:
- Attend general meetings;
- Inspect minutes of meetings;
- Get copies of minutes;
- Vote on resolutions in general meetings;,
- Vote to change the organisation’s rules; and
- Vote to appoint and remove committee members.
Importantly, your rules also allow you to make complaints about other members and make submissions on disciplinary actions against other members.
5. What If I Have Been Denied My Rights?
If you feel that your organisation has not met any of the rights in your constitution, you can initiate a grievance procedure. These are procedures outlined in your rules that deal with disputes between the organisation and its members.
Under the Associations Incorporation Act 2009 (NSW), you also have the right to obtain a court order directing the organisation to follow its rules. You should only commence this action if a grievance procedure and mediation has failed to resolve the issue.
6. Can My Right Be Suspended?
It is important to remember that your member rights can be suspended if you do not follow your obligations under the rules. Situations like this commonly occur if a member does not pay their annual fee.
If you have any further questions or need assistance setting up an incorporated association for your community group, get in touch with our business structuring lawyers on 1300 544 755.