[wlug_org] Individual liability from not being incorporated.

[Carl Klitscher]

> You're still asserting that being incorporated is some sort of all
> encompassing protection

Ahhh - there we have it. No I'm not saying that at all. It does become a
legal entity with corresponding rights and responsibilities and may or may
not be of benefit to a particular group of individuals but it doesn't
absolve people of individual responsibilities either.

> The inc. society act 1908 essentially says
> "Except when otherwise expressly provided in this Act, membership of a
> society shall not of itself impose on the members any liability in
respect
> of any contract, debt, or other obligation made or incurred by the
society."

This is the important bit and is the basis of the limited liability vs.
open slather I was getting at. The example used quite clearly stated that
individual liability (or negligence) could not be ascertained. The
insurance company then decides to go after the group. If the group is
incorporated and running the meeting under the groups banner then the
liabilty is the groups assets ($425), not the individual members (assuming
the rules/constitution were worded that way). How to identify members of a
non-incorporated group for the purposes of the example? Easy, the person
who booked the room would be an obvious starting point. I'm sure that they
would cough up a few more names if pressed. A very wide net granted but if
your aim as an insurance company was to recoup your losses then why should
you care who gets caught?

> The incorporated societies act protects you
> from little apart from liabilities directly incurred by the society
within
> its rules.

And that's the whole point. If we are going to incorporate then the rules
(constitution) are what defines, amongst other things, the membership
criteria, the aims and objectives, the powers of the governing body, how
the governing body is elected/replaced, how the rules may be changed, what
to do in the event of dissolution and possibly a number of other things if
you want them included. A well written constitution will clearly define
what the Inc.Soc. can/can't will/won't do and that's where the protection
comes in. Anything I do outside of Wellylug is of little or no interest to
Wellylug however if I run up a debt purportedly on behalf of Wellylug
(Inc.) that is outside the bounds set by the constitution then Wellylug and
it's members are protected. At the moment, with no constitution, rules or
anything else there is potential, however remote, to cause a great deal of
grief to a number of people who meet under the generic name of Wellylug. In
time things would be sorted out and whoever caused the trouble would
eventually be pinpointed as liable for whatever it was but it would still
be a hassle most people could do without.

Am I recommending we incorporate? Nope, not at all. As a group we can't
even decide what to have for a social dinner so organising the requisite
number of signatories and paperwork for incorporation is clearly beyond us.
Then there is the ongoing challenge of AGM's, keeping minutes, annual
account filings and audits... yahoo, can't hardly wait...

Carl