Gifts to Non-charitable Unincorporated Associations

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.

Edited at 2020-10-10 07:04:15

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Gifts to Non-charitable Unincorporated Associations

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Outline

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

Could demand capital under Saunders v Vautier

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