Voluntary association


A voluntary group or union is a group of individuals who enter into an agreement, usually as volunteers, to form a body to accomplish a purpose. Common examples include trade associations, trade unions, learned societies, professional associations, and environmental groups.
Membership is not necessarily voluntary: in order for particular associations to function correctly they might need to be mandatory or at least strongly encouraged, as is common with many teachers unions in the US. Because of this, some people use the term common-interest association to describe groups which form out of a common interest, although this term is not widely used or understood.
Voluntary associations may be incorporated or unincorporated; for example, in the US, unions gained additional powers by incorporating. In the UK, the terms Voluntary Association or Voluntary Organisation cover every type of group from a small local Residents' Association to large Associations with multimillion-pound turnover that run large-scale business operations.

Differences by jurisdictions

In many jurisdictions no formalities are necessary to start an association. In some jurisdictions, there is a minimum for the number of persons starting an association.
Some jurisdictions require that the association register with the police or other official body to inform the public of the association's existence. This could be a tool of political control or intimidation, and also a way of protecting the economy from fraud.
In many such jurisdictions, only a registered association is a juristic person whose members are not responsible for the financial acts of the association. Any group of persons may, of course, work as an informal association, but in such cases, each person making a transaction in the name of the association takes responsibility for that transaction, just as if it were that individual's personal transaction.
There are many countries where the formation of truly independent Voluntary Associations is effectively proscribed by law or where they are theoretically legally permitted, but in practice are persecuted; for example, where membership brings unwelcome attention from police or other state agencies.

History

Voluntary groups are a broad and original form of nonprofit organizations, and have existed since ancient history. In Ancient Greece, for example, there were various organizations ranging from elite clubs of wealthy men to private religious or professional associations.
In preindustrial societies, governmental administrative duties were often handled by voluntary associations such as guilds. In medieval Europe, guilds often controlled towns. Merchant guilds enforced contracts through embargoes and sanctions on their members, and also adjudicated disputes. However, by the 1800s, merchant guilds had largely disappeared. Economic historians have debated the precise role that merchant guilds played in premodern society and economic growth.
In the United Kingdom, craft guilds were more successful than merchant guilds and formed livery companies which exerted significant influence on society.

Legal status

A standard definition of an unincorporated association was given by Lord Justice Lawton in the English trust law case Conservative and Unionist Central Office v Burrell :
In most countries, an unincorporated association does not have separate legal personality, and few members of the association usually enjoy limited liability. However, in some countries they are treated as having separate legal personality for tax purposes: for example, in the United Kingdom an unincorporated association is assessable to corporation tax. However, because of their lack of legal personality, legacies to unincorporated associations are sometimes subject to general common law prohibitions against purpose trusts.
Associations that are organized for profit or financial gain are usually called partnerships. A special kind of partnership is a co-operative which is usually founded on one person—one vote principle and distributes its profits according to the amount of goods produced or bought by the members. Associations may take the form of a non-profit organization or they may be not-for-profit corporations; this does not mean that the association cannot make benefits from its activity, but all the benefits must be reinvested. Most associations have some kind of document or documents that regulate the way in which the body meets and operates. Such an instrument is often called the organization's bylaws, constitution, regulations, or agreement of association.

Common law

England and Wales

Under English law, an unincorporated association consists of two or more members bound by the rules of a society which has at some point in time, been founded.
Several theories have been proposed as to the way that such associations hold rights. A transfer may be considered to have been made to the association's members directly as joint tenants or tenants in common. Alternatively, the funds transferred may be considered to have been under the terms of a private purpose trust. Many purpose trusts fail for want of a beneficiary and this may therefore may result in the gift failing. However, some purpose trusts are valid, and, accordingly, some cases have decided that the rights associated with unincorporated associations are held on this basis. The dominant theory, however, is that the rights are transferred to the members or officers absolutely, perhaps on trust for the members, but are importantly bound by contracts inter se.
Accordingly, on dissolution, the distribution of these rights depends on how they were held. A purpose trust may by its nature survive the dissolution of the association, or it may not. If it fails as a result of the dissolution, then the rights will be held on resulting trust for the contributors, unless they can be shown to have renounced their right to such a trust in their favour. If the rights are held subject to contract, then they will be divided among the surviving membership upon dissolution, according to the terms of the contracts inter se or an implied term according to contribution. If, as a result of this contract or statute, no member can claim, the rights will pass to the Crown as bona vacantia. This conclusion has also been suggested where the association dissolves because only one member remains, although this has been doubted by some commentators who believe the last members should be entitled to the rights.

Scotland

on unincorporated associations is essentially the same as English law.

United States

Each state sets its own laws as to what constitutes an unincorporated association and how it is to be treated under the laws. In the United States, voluntary associations which were incorporated were "pre-eminent" in collective action.
In most states and territories in Australia, a similar set of laws allows not-for-profit associations to become legal entities with a limit to the liability of their members. An example of such a law, the Associations Incorporation Act that is in force in South Australia, allows for the creation of a legal entity able to buy and sell land and in general, enter into legally binding contracts. Many clubs and societies begin life as an unincorporated body and seek to attain incorporated status to protect its members from legal liability and in many cases to seek government financial assistance only available to an incorporated body. Clubs and societies wishing to incorporate must meet the provisions of the relevant state act and lodge their constitution with the corresponding state government authority.

Civil law

Certain civil-law systems classify an association as a special form of contractual relationship.

Canada

Under the Quebec Civil Code an association is categorized as a type of statutory specific contract set forth in a constitution. An association can become incorporated with its own legal identity so that it may, e.g., open a bank account, enter into contracts, or sue or be sued.

France

In France, all voluntary associations are non-profit. They may count as unincorporated or incorporated and are created in terms of and governed by the Waldeck-Rousseau Act 1901. This is why :fr:Association loi 1901|association loi 1901 is subjoined to their name, except in the Alsace-Moselle area, which is governed by local law in this regard, and are therefore called :fr:Association loi 1908|association loi 1908.. If the association responding to defined criteria, like social or medical help, for example, they can be declared "public utility association" by French authorities. Associations act 1901 have a significant amount of freedom in their internal operation, such as management or authorized members.

Germany

The German Civil Code sets out different rights and rules for an unincorporated association with legal identity versus an incorporated association with full legal personality, which the law treats as partnerships. Associations can be for-profit, non-for-profit, or public.

Israel

In Israel, many non-profit organizations and non-governmental organizations are established as registered nonprofit associations . ‘‘Amutot’’ are regulated by the Associations Law, 1980. An amutah is a body corporate, though not a company. The amutah is successor to the Ottoman Society which predated the State of Israel, and was established by the now-superseded Ottoman Societies Law of 1909, based on the French law of 1901. An amutah must register with the Rasham Ha’amutot, under the purview of the Rashut Hata’agidim of the Ministry of Justice.

Freedom of association

The freedom of association stands in the Universal Declaration of Human Rights:
Article 11 of the European Convention on Human Rights also protects the right to freedom of assembly and association.