1. committee or designated trustees. These trustees hold the Association's assets but are
subiect to the committee's directions.
The contractual liability of the individual members of the committee should also be
made clear if they are to limit their personal liability. The committee can either contract
as agents and on behalf of all of the members or in their own name with a right of
indemnity from the members. It is important that members of the committee are aware
of the extent of, and therefore in particular any limitation of, their powers, which should
be expressly provided in the rules.
There are no formal requirements to set up an association. However there is likely to be
some need to regulate the relationship between the stakeholders and some basic rules will
need to be established. The cost of establishing a set of rules will vary depending upon
the complexity of the particular circumstances. Costs from £500 should be anticipated.
The Trust
A trust is traditionally created by a settlor (often though a will) who transfers property or
funds to, usually named individual, trustees upon trust for specific purposes. Where those
purposes are exclusively charitable the trust must be registered with the Charity
Commission.
A trust is an unincorporated body and is governed by a trust deed (for example the will)
which will identify its purposes along with any powers of the trustees. There are certain
restrictions on trustees' activities and these can be found in the Trustee Act 1925, Trustee
Act 2000 and various other enactments.
As an unincorporated body the trustees will not have the benefit of limited liability,
although it may be possible in appropriate circumstances to either incorporate the trust
(involving a legal transfer of the assets held in trust from the unincorporated trust to an
appropriate incorporated vehicle such as a CLG) or alternatively to appoint corporate
trustees to act, i.e. rather than the trustees should be individuals (usually at least two) a
company (usually a CLG whose objects are specifically structured to act as a trustee) is
appointed as sole trustee. The directors of a corporate trustee would have the benefit of
limited liability.
A Guide to Legal Structures for Social Enterprise © Wrigleys Solicitors LLP Sept 2009 (mjl) 20