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Gifts to Non-charitable Unincorporated Associations
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An unincorporated association is an association that has not been incorporated (i.e. ... (ii) Gift to the association's members subject to the association's contract.
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W301 UNIT 9B: GIFTS TO NON-CHARITABLE UNINCORPORATED ASSOCIATIONS
Gift to members at the time of the gift, as joint tenants or tenants in common
Gift to existing members subject to their contractual rights and liabilities
Trust for the purposes of the association
Neville Estates v Madden [1962] 1 Ch 832
Outright gifts with no purpose attached
Neville 2 will apply
an accretion to the club's funds, subject to club rules
Re Recher's Will Trusts [1972] Ch 526
must have a rule permitting winding up of club and distribution of assets
must have a rule permitting club funds to be spent in any way they wish
Re Grant's Will Trusts [1979] 3 All ER 359
or offends rule against inalienability
Gifts with a purpose attached
Inward looking purpose
Re Lipinski's Will Trusts [1976] Ch 235
To construct and/or improve new buildings for the association
Benefits members only
Does not offend rule against inalienability
Valid under Neville 2 or 3
2
Could demand capital under Saunders v Vautier
3
Valid as a Denley trust
Outward looking purpose
Does not benefit members
Saunders v Vautier does not apply
Void as a purpose trust
Rules
must still satisfy beneficiary principle
must still satisfy rule against inalienability
Features
Not a legal entity
Cannot hold property
Trustees hold property on trust for members
Definition
Two or more members bound together to pursue some common purpose
Mutual rights and duties arising from contract between them
Rules that lay down terms of members' contract
Members can join or leave at will
