What are the legal responsibilities of an organisation’s members?
The nature of a member’s responsibilities depends on the structure of the relevant organisation, and the terms set out in the organisation’s governing document. The membership have ultimate control, with the right to appoint and remove board members and amend the organisation’s constitution.
In general, for societies and other unincorporated organisations, each member enters into a contract with all other members to abide by the organisation’s constitution. This will include a duty to contribute to all debts and liabilities of the organisation.
In general, for Companies Limited by Guarantee (CLG), each member enters into a contract with the company on the basis of the company’s Articles of Association. This includes a duty to contribute to the debts and liabilities of the organisation, but only up to the guarantee set out in the constitution.
In general, for charitable companies and Charitable Incorporated Organisations (CIOs), members are under a duty to act in the best interests of the charity, but are not financially liable for any debts or liabilities of the organisation over and above the maximum guarantee set out in its constitution.
Trusts, by definition, do not have members, and all responsibilities are with the trustees.
The Charity Commission’s view that members of a charity owe a fiduciary duty to vote in the best interests of the charity has been supported by a recent legal case (The Children’s Investment Fund Foundation (UK) case https://www.supremecourt.uk/cases/uksc-2018-0150.html).
The rules of natural justice should be followed in reaching a decision for the expulsion of a member. This means that a decision must be made by an unbiased body and that failure to give the member a meaningful opportunity to give an account of themself and the events leading to the termination of their membership, or to highlight any potentially mitigating features, could lead to a successful challenge.
