Club Management

Trustees

There are usually trustees of an unincorporated club who hold property and assets on trust for the members. They may be given powers to invest at the direction of the committee under the rules or otherwise.

Trustees and committee are not entitled to an indemnity from members in the absence of a provision so providing in the rules. General principals of members may not become liable in the absence of a rule to pay monies to the society or club beyond subscriptions.

The trustees have a lien on trust property for all assets, liabilities property incurred by them on behalf of the club.

Management Committee

The rules usually provide that a committee manages the club. It will be elected in accordance with the rules. Unless the rules provide that it may act by a quorum and majority, all members of the committee may be required to approve the decision.

The secretary’s function is to conduct correspondence, collect subscriptions and preform clerical functions under the direction of the committee.

The clubs committee may have authority to borrow and mortgage assets and issue debentures. This will depend on the rules. There may be an undertaking to pay out of the funds of the club but not otherwise. This is effectively a limited recourse loan secured by the club assets.

Authority of Committee

The authority of the club committee is determined by the rules and general principles of agency. The trustees and committees have the power to contract on behalf of the members as expressed or implied by the rules.

Club rules would not generally be interpreted to give the committee the authority to make contracts personally binding on members in the absence of very clear provisions. This would be very unusual.

The management committee is under an obligation to pay expenses and liabilities from the club’s funds. If they’re insufficient, they must convene a meeting to seek additional funds. They do not have power to pledge the members’ credit without express authority.

Liability of Members

Members of a club may be liable on contracts entered by trustees, management committees or agents within the scope of the authority given by the rules. If they are beyond the scope of the rules, the members may be bound if they can be shown to have sanctioned or ratified the committee’s action or held them out as having the authority.

The general assumption is that rights and liabilities of members of a club are joint. All members should be joined as plaintiffs or defendants if an action is brought against them. The court rule may permit another course.

Once judgment is recovered, this is a bar against proceeding against the others. The member who discharges more than his proper share would generally be entitled to contribution under Civil Liability Act.

A member who resigns is liable in respect of contracts entered prior to resignation. He did not liable on subsequent transactions.

Contracts

Trustees and members of the management committee who purport to act on behalf of the club or others may incur a personal liability if by the terms of the contract, they act in excess of their authority.

If they contract in their own names, they’re presumptively liable and may be sued personally. If they were authorised by the club, the other party may elect to sue them or sue the members as his principal. This is a provision under agency law irrespective of whether the agency was disclosed at the relevant time.

Any person who purports to contract on behalf of another gives a warranty of authority. Therefore, if a person exceeds his authority, he is liable in damages personally to the third party.

Civil Wrongs

As regards actions for civil wrongs by third parties, there is no distinction between committee members and ordinary members. The committee members may be liable to the exclusion of members if they are negligent in employing a particular person thereby causing injury to another.

The question is whether the actual wrongdoer stands in relation to them as an agent and if so whether he was acting within the scope of his authority. If this is so, the question analyses as to who the principals are. Sometimes it may be the committee of management rather than the members.

Legal Proceedings

An unincorporated members’ club cannot sue or be sued in its own name. Trustees may however sue and be sued in respect of club property vested in them. In this case, they act on behalf of the members beneficially entitled to it.

Further and numerous persons having the same interests in a matter, the court may permit them to sue one or more to sue or be sued for or on behalf of them all. A representation order may be made in a contract or civil wrong case provided that the members whose names appear on the summon may be fairly taken to represent the interests of the body of the club members.