Key points

• an unincorporated association does not have legal personality;

• gifts to an unincorporated association will normally be regarded as invalid purpose trusts;

• a gift to an unincorporated association can be upheld in a number of different ways;

• the most popular theory is to uphold a gift to an unincorporated association in the contract-holding theory;

• an unincorporated association must have two or more persons bound together for one or more common purposes;

• persons within the association will have mutual rights and duties arising from the contract between them and rules concerning its control; and

• in order to be recognised the members must be able to join or leave the association at will.

Introduction

The law recognises private individuals and companies. They can both hold property and bring legal actions against others. The law does not recognise groups of people who do not have corporate status. Many groups of people join together for a common pursuit such as sport but do not want the difficulties and complications of registering as a company. This presents a problem where the group holds funds or is left a sum of money under a will, as it is difficult to see on what basis this property is held. There is a further difficulty in deciding what should be done with any surplus funds where the association is wound up. There are hundreds and hundreds of such associations so the law has had to find a way to recognise them.