The majority of sporting clubs or community groups on formation usually adopt the Model Rules provided in the regulations under the Associations Corporation Act (Qld). This is done out of the necessity to create a legal entity to conduct the club operations as cost-effectively as possible.
Although this is understandable, founding members and current members of Associations need to carefully consider the legal implications and long-term consequences of using such an entity or its rules which should be renewed regularly.
Incorporated Associations while simple and cost-effective for clubs and associations with small memberships and limited activities may not be suitable for fast growing dynamic sports groups.
The key issues that need to be addressed from time to time are the liability of directors/members and voting rights for members passing important resolutions without the need for an expensive and time-consuming general meeting of all members.
Typically sporting and community clubs are run by a dedicated strong board who volunteer huge amounts of time into the development, support promotion of their club.
Their activities and vision can be thwarted by having other members in the Club who, although they do not contribute anything, still have the right to vote on a particular course of action. This can be divisive and can paralyse the functioning of a club and its growth.
To reduce liability and ensure sustainability sports bodies need to consider converting to or establishing a not-for-profit Company limited by guarantee. Peak bodies such as Football Queensland are recommending clubs convert to this structure which has major advantages over an Incorporated Association
McLaughlins Lawyers have assisted various sports and other community groups in drafting their constitutions and advising on their legal structure over its 60 year history.
Contact us now to find out how the approachable and experienced team at McLaughlins Lawyers can review a Sports or Community Club constitution and provide advice on how it could or should be re-structured or amended to achieve future growth and success for the Club.
For further information please contact Geoff Smith, Special Counsel at Mclaughlins Lawyers, or Alex Hamlyn a Solicitor who deals with Sports Law on (07) 5591 5099.
Author: Geoff Smith
Director: Ian Kennedy
Date: 19 July 2019