Up the Creek without a Paddle: The Law Relating to Unincorporated Associations

December 31, 2020 | Natasha Smith, Katrina Kairys | Toronto

Estates Trusts & Pensions Journal

Charities and non-profit organizations are often faced with the question of whether to incorporate. Some decide that it is not worth the trouble, while others put off the decision until the organization grows in size. There are also those that do not consider the question at all. While members may have the best of intentions, a lack of forethought can have catastrophic outcomes. Any charity or non-profit organization that exists as an unincorporated association is well-advised to consider the benefits of incorporation. Existing as an unincorporated association is a poor choice for most charities and non-profit organizations for two reasons: (1) they lack a separate legal existence apart from their members, exposing their members to personal liability; and (2) with the exception of Quebec, they are not governed by legislation in the Canadian provinces, making good governance next to impossible without a robust written constitution.

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