The law can be uncertain in relation to community organisations so clarity is important regarding operations and structure. The most common legal structure is the incorporated association. Voluntary, non-profit groups are the main target of this chapter.
Often people will want to form a group to pursue a common goal, be it a school parents’ association or a local netball club. For this reason, most people at some time will either be part of a community organisation or at least deal with one.
Community organisations are of enormous importance. Despite this, the operation of the law in relation to them is often uncertain. For this reason, it is important to have an awareness of the basic operation and structure of such organisations. The sort of legal structure chosen will affect the members of the group in significant ways. Principally, the choice of structure for any community organisation should balance two key matters:
•the personal liability of each member of the group; and
•the operational costs of the structure chosen.
This chapter cannot give a definitive account of every form of community organisation. Nor can it set out the law as it relates to these organisations in detail, but it does provide an overview of the most common legal structures available to community organisations, their advantages and disadvantages, and the method of establishing one of the most common legally recognised structures: the incorporated association. More generally, the content of this chapter is directed only to voluntary non-profit associations.
“Non-profit” is a term often used in relation to associations. This term does not mean that the organisation cannot make a profit or a surplus, rather that the members cannot make a profit on the basis of their membership. All profits made by the organisation must be used to benefit the organisation or, in the case of a charity, the beneficiaries of that charity.
For more information on this issue, see “Further reading”.