Legal Action
Can an association member sue an incorporated association in New South Wales?
Yes, an association member can sue an incorporated association in New South Wales.
Here's a breakdown of why and how:
1. Separate Legal Entity:
The key reason is that an incorporated association, under the Associations Incorporation Act 2009 (NSW), is a separate legal entity. This means it has its own legal identity distinct from its individual members and committee members.
As a separate legal entity, it has the capacity to:
- Enter into contracts
- Own property
- Sue
- Be sued
2. Grounds for a Lawsuit: A member might sue an incorporated association for various reasons, including but not limited to:
- Breach of Contract: If there's a contractual agreement between the member and the association that has been breached (e.g., a service agreement, or terms of membership).
- Breach of the Association's Constitution / Rules: The association's constitution (or rules) is a binding contract between the association and its members. If the association, through its committee, acts in a way that breaches its own constitution, a member may have grounds to sue to enforce those rules. The Associations Incorporation Act 2009 (NSW) even specifically allows for proceedings against the association by a member to restrain the doing of any act by the association that is prohibited by the Act or its rules.
- Negligence: If the association, through its actions or omissions, causes harm to a member due to negligence.
- Mismanagement or Dereliction of Duty (leading to harm to the member): While the primary duty of the committee is to the association, if their mismanagement directly impacts a member in a legally actionable way, a lawsuit might arise.
- Disputes over Membership Rights: If a member's rights as outlined in the constitution (e.g., voting rights, access to information) are denied or infringed upon.
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