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Alex J.
Alex J., Solicitor
Category: Law
Satisfied Customers: 3846
Experience:  Solicitors 2 years plus PQE
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On the website associations#

Customer Question

On the website associations# ***** states: "Individual members are legally responsible for the acts and ommissions of the entire association".
It also states "that an unincorporated association cannot itself borrow money.
I have been told by David Billings ,a solicitor from Stratford -upon-Avon, that my statement that the members are responsible for repayment of loans taken up by the society without a mandate from the members is ludicrous.
Can you please explain the reason for the difference in these two opinions.
Submitted: 3 years ago.
Category: Law
Expert:  Alex J. replied 3 years ago.
Thank you for your question and welcome.
My name is ***** ***** I will assist you.
I will answer each question in turn:
1. Why can't an un incorporated association borrow money?
This is because an un incorporated association is not a distinct legal person (like an LLP, limited company or a person) - therefore if it borrows money it is effectively all the members jointly borrowing money together.
2. Why has this been described as "ludicrous" - the reason for this is I imagine is because all the members are being given the power to bind one another to a liability and a debt - conceptually you are saying to someone when they become a member they are giving the managers of the association the power to borrow money in their name.
Do you have any further information you can provide me?
Kind regards