Last updated 16 August 2016
Non-profit organisations that are structured as a company limited by guarantee or structured using letters patent, a cooperative, formal trust or some other legislative structure should seek legal advice before attempting to incorporate under the Associations Incorporation Act 1981 (Qld) (Associations Incorporation Act). Your legal adviser will check to see if changing from one legislative scheme to another has any added requirements or costs, for example you may need to pay stamp duty or apply for an exemption from stamp duty if your organisation owns property that will be transferred to the new legal structure.
Incorporation of a new association
A provisional committee
The first step for an individual who wishes to form an association is to enlist the support of a few other people and form a provisional committee. A chairperson and secretary should be elected from this provisional committee.
The committee should do some planning about their proposed association. It is important for the committee to consider the aims and objects of the proposed association to not duplicate those of existing associations, and survey the public support needed to make the association viable. If the association seeks a sanction under the Collections Act 1966 (Qld), the association will have to produce a good rationale for existence, or it will be unable to seek public donations.
The committee should consider whether it needs to hold a public meeting to discuss the proposed association. Some committees just hold a small meeting of invited supporters to fulfil the formal requirements of seeking incorporation.
Planning the initial meeting
Although attendees of the initial meeting called to discuss the proposal to form an association are free to elect their own chairperson and committee, and even decide not to support the idea of forming an association, the provisional committee should still plan the public meeting carefully. The public will expect the provisional committee to have an agenda, people primed to offer to become committee members, a draft set of motions, a model constitution for consideration and a plan of action. If attendees at a public meeting sense that the provisional committee has not done their homework, they may be disinclined to support the association. At the same time, the provisional committee should be ready to listen to the ideas and concerns of the initial meeting attendees.
The provisional committee should consider the following requirements, which will bear on the agenda of the initial meeting:
- the name of the association
- the objects of the association, which should be drafted with care, particularly if charitable purposes or deductible gift recipient status are intended
- a drafted motion for the formation of the association, with a person organised to move it and another to second it
- a list of candidates who are prepared to nominate as interim office holders in the new association (the minimum is a president and treasurer, although consideration should be given to the appointment of a secretary)
- the need for at least seven members
- a draft set of rules to be presented at the meeting
- a nominated address for service of documents on a person that is located in Queensland (a post office box is not allowed)
- a collection to offset the costs of arranging the public meeting, if any, and funds to establish the association (e.g. the filing fees that must accompany an application for incorporation).
The provisional committee should also consider whether it needs to engage a solicitor to help prepare the incorporation application and particularly the rules of the association.
The public meeting
The only task of the chairperson chosen by the provisional committee is to call the meeting to order and supervise the first item of business, which is the election of a chairperson for the meeting. It must be remembered that it is a fundamental right of a public meeting to elect its own chairperson.
The next item should be to elect a secretary for the meeting to keep minutes of the proceedings. The secretary should ensure that an attendance roll is kept with the addresses of the participants. This will be invaluable if the association is to seek further support. Apologies can also be recorded.
It is then appropriate for a spokesperson of the provisional committee to explain the nature of the proposed association, its objects and background. This should be followed by a motion to form the association. After this motion is seconded, the chairperson will open the matter for discussion by the general meeting. After discussion is concluded, the vote is taken and usually the association is formed.
The provisional committee could then introduce the draft constitution or elect a committee to consider a constitution and report back to a further meeting.
Incorporation requirements for all associations
When the rules of the association are settled, or in the case of existing unincorporated associations, members can, by special resolution, decide to apply for incorporation and adopt the rules (s 6(1) Associations Incorporation Act). A special resolution is one where three-quarters of those members present in person, by proxy or by an attorney and entitled to vote at the meeting, vote for the resolution. Matters such as proxy voting are considered in the context of the rules of association later in this chapter.
Notice of the meeting at which the special resolution is to be passed is governed by s 3 of the Associations Incorporation Act. A notice must be prepared that states the terms of the proposed resolution to incorporate and adopt the rules. It should be brought to the attention of each member who is entitled to vote at the meeting. Any other provisions in the association’s rules must also be complied with (e.g. length of notice or placement on a notice board). If this is not complied with, the special resolution will be of no effect (s 3(3) Associations Incorporation Act). The important issue is that each member gets fair and reasonable notice of the resolution in writing. The resolution could be in the following form:
That the [INSERT NAME OF ASSOCIATION] incorporate as an incorporated association under the provisions of the Associations Incorporation Act 1981 (Qld).
The result of the resolution should be noted in the minutes of the meeting, with numbers for and against, where possible. For existing associations, if the resolution is successful, a resolution ought to be passed adopting the new name of the association. It may be that the association decides merely to add Inc. or Incorporated after its existing name as required by s 29 of the Associations Incorporation Act. Consideration should also be given to deciding on alternative names if the Office of Fair Trading decides that the first preference is not available.
The meeting should also appoint by ordinary resolution (over 50% of the members present and entitled to vote) a person to prepare the application to incorporate (s 7 Associations Incorporation Act). The person responsible for the preparation of this application should have a detailed knowledge of the association and be available during business hours to answer queries from the Office of Fair Trading.
Under the Associations Incorporation Act, the business and operations of an incorporated association are controlled by a management committee (s 60). The meeting should elect an interim president, treasurer (s 8) and perhaps a secretary (if the association has not already done so). Note that the committee members must be adults (s 61(2)) and not be in any of the circumstances described in s 61A of the Associations Incorporation Act (e.g. bankrupt or convicted of an indictable offence). The secretary must have similar qualifications (s 69(2)) and also be a resident in Queensland (or not more than 65 km from the border). A nominated address for service of documents should also be considered (s 17).
It is also necessary to have at least seven members before lodging the application to incorporate (s 5(1)(a) Associations Incorporation Act).
The final matter for discussion at the meeting is the adoption of the new rules of the association. Usually, the committee prepares a draft and circulates copies to the members for consideration before the meeting. This must also be considered as a special resolution (s 6(1)(b) Associations Incorporation Act).