Unincorporated Associations Flashcards
Definition
An unincorporated association is where a group of people come together to form an organisation in pursuit of a specific activity.
An express trust is used and it is a trust for persons - the beneficiaries are the members of the UA. They are used in this way because private purpose trusts are void under English law, and they are not always charitable purposes.
Conservative and Unionist Central Office v Burrell
Lawton LJ set out the four requirements for a UA:
1) Association of 2 or more people
2) These individuals must be bound together for a common purpose through contracts, with mutual rights and obligations
3) The association has rules which determine who controls its trust fund and the terms on which it can be exercised
4) It must be possible for the UA to be joined or left at will
Re Recher’s WT
Court noted the four main accepted ways that a gift to a UA can be held
1) Outright gift to present members
2) Gift for present and future members
3) Gift for the association’s abstract purpose which is sufficiently direct and tangible for a specific group of beneficiaries to enforce the trust - Re Denley’s Trust Deed
4) Gift to each of the members of the association as an accretion to the association’s property to be dealt with by the association’s rules - done through contract
Re Lipinski’s WT
Oliver J held that the gift could be construed as an accretion to the association’s property, subject to the rules that members are contractually bound by - this is a form of absolute gift, specifically to the association’s property to be used in accordance with the rules.
The key difference between an absolute gift to members and an accretion to the UA’s property is whether the gifted property is subject to the UA - look at the terms on which the gift was made to determine the more appropriate legal analysis.
Re Bucks
Regardless of how the money was paid into the association, any surplus money must be paid to the members provided that the rules do not prohibit the money from being paid to the members of the UA.
Re St Andrew’s Lawn Tennis Association
Trust was held to be valid, so the issue was who owned the land purchased by members of the UA (through an option to buy which they exercised.
Court held that the money from the subsequent sale of the freehold (after the UA purchased it) could not be divided up and paid to members since this was contrary to the UA’s rules. Therefore, the proceeds for the subsequent sale were held on RT for the original freehold owner.
This seems unfair because the original freehold owner got paid twice for the property - Charles Mitchell argues that the property should have been declared owner-less and reverted to the crown - bona vacantia.
Hanchett-Stamford v Attorney General
Where there is only one member of the UA left alive, the last member of the UA is wholly entitled to the property, provided they are joint tenants. This is because the contracts between the members set out that they held the UA property as joint tenants, so survivorship principle applied
Re West Sussex
If the rules of the UA prohibit any surplus money from being distributed amongst its members, then the surplus money will be held on RT for the donor. So if the UA rules give the UA members no right to the money (e.g. by saying that any surplus money cannot go to them), then the money is held on RT for the donor(s).
