NOTICE TO ALL MEMBERS
At a convenient time during the Trophy Show there will be an Emergency General Meeting, the purpose which is to vote on the proposal:
The committee recommend the structure of Llantwit Major and District Riding Club be changed from an Unincorporated Association to a Company Limited by Guarantee.
Ok, so what’s all this about, then?
Quite simply, legal liability.
Since 1974 the Club has existed as an ‘unincorporated association’. That means it’s basically a business but run by an elected committee rather than having an owner or board of directors. And although financial accounts are produced every year, because the club operates on a non-profit basis (everyone involved in the running of it is an unpaid volunteer) it is not registered with HMRC.
This leaves us open to a certain amount of risk. The Tax Office may suddenly decide to investigate us, which can be a very costly exercise since it may involve hiring legal experts to present our case. Worse, if there were to be a serious accident, although we have Club insurance through BHS Riding Clubs and Farm Insurance on Tremains itself, if either were to fail it is possible for the Club itself to be sued. That means every one of us would be legally liable to contribute to any damages that might be awarded which, these days, can run into many millions of pounds.
To shield their members from potential legal claims of this type, many of the country’s governing bodies for sport, especially those sports with the potential for physical injury, are recommending clubs protect themselves by setting up as Companies Limited by Guarantee. The BHS strongly advise it, as do the Welsh Rugby Union, to give just two examples. It means that if the Club were to be sued, the maximum amount any member may be legally obliged to contribute to a compensation claim is just £1. It also means we would be registered with HMRC as a non-profit organisation and thus prevent unexpected visits from tax inspectors! Registering as a Company Limited by Guarantee means we will be involved in a certain amount of extra administration, but the small additional costs the Club will incur are far outweighed by the benefit of peace of mind.
The committee believe this is the best way to safeguard members’ interests, and can only increase the Club’s professional standing for the future.
If you’d like to read the proposed Articles of Association (the legal document required by Companies House) please click on the link below:
Llantwit Major & District Riding Club 