Discussion Paper on Unincorporated Associations

This discussion paper identifies the legal issues which may affect the tens of thousands of non-profit making associations (including many charities) and clubs and suggests possible ways forward.

Unincorporated associations are not recognized as legal entities separate from their members.

The consequence of this is that such organizations do not have the capacity to enter into legal relationships, such as in contract or delict, or hold title to land in their own name.

This can give rise to unfortunate, and perhaps unforeseen, repercussions for members.

For example, it is possible under the current law that a member of an unincorporated association may, by virtue of that membership alone, find himself or herself personally liable in delict to a third party injured at an event organized by the association.

It may not be readily apparent to members that, by joining a voluntary group or club, they may be exposing themselves to serious personal financial risk. The Commission seeks views on whether it would be preferable to attribute legal personality to all organizations meeting certain specified minimum criteria; to allow organizations to opt-in to such an arrangement either by registration or by statement of intent; to grant certain legal capacities to unincorporated associations without according them the status of legal persons; or to introduce a new corporate vehicle specifically designed for non-profit organizations which are not registered as charities.