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Rules and obligations

This page provides general information on rules of incorporated associations under the Associations Legislation. References to the Act refer to this legislation, which is administered by the Office of Fair Trading.

What are the rules of the incorporated association?

The rules of an incorporated association form the structure within which the association operates. The rules include the constitution, regulations and by-laws, if any, of the association. An association may:

  • adopt the model rules in PDF format (size: 558k)
  • adopt the model rules with changes, or
  • draft its own rules.

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What matters have to be covered in our rules?

The rules must provide for each of the matters set out in Schedule 1 to the Act, as follows:

1. Membership qualifications
The qualifications (if any) for membership of the incorporated association.

2. Register of members
The register of members of the incorporated association. 

3. Fees, subscriptions etc
The entrance fees, subscriptions and other amounts (if any) to be paid by members of the incorporated association.

4. Members' liabilities
The liability (if any) of members of the incorporated association to contribute towards the payment of the debts and liabilities of the association or the costs, charges and expenses of the winding up of the association.

5.Disciplining of members
The procedure (if any) for the disciplining of members and the mechanism (if any) for appeals by members in respect of disciplinary action taken against them.

5A. Internal disputes
The mechanism for the resolution of disputes between members (in their capacity as members) and between members and the incorporated association.

6. Committee
The name, constitution, membership and powers of the committee or other body having the management of the incorporated association (in this paragraph referred to as the committee) and:

(a) the election or appointment of members of the committe,
(b) the terms of office of members of the committee,
(c) the grounds on which, or reasons for which, the office of a member of the committee shall become vacant,
(d) the filling of casual vacancies occurring on the committee, and
(e) the quorum and procedure at meetings of the committee.

7.  General meetings-calling of
The intervals between general meetings of members of the incorporated association and the manner of calling general meetings.

8.  General meetings-procedure
The quorum and procedure at general meetings of members of the incorporated association and whether members are entitled to vote by proxy at general meetings.

9.  General meetings-notices
The time within which, and the manner in which, notices of general meetings and notices of motion are to be given, published or circulated.

10.  Funds-source
The sources from which the funds of the incorporated association are to be or may be derived.

11.  Funds-management
The manner in which the funds of the incorporated association are to be managed and, in particular, the mode of drawing and signing cheques on behalf of the incorporated association.

12.  Alteration of objects
The manner of altering the statement of objects of the incorporated association.

13.  Rules
The manner of altering and rescinding the rules and of making additional rules of the incorporated association.

14.  Common seal
Provision for the custody and use of the common seal of the incorporated association.

15.  Custody of books etc
The custody of books, documents and securities of the incorporated association.

16.  Inspection of books etc
The inspection by members of the incorporated association of books and documents of the incorporated association.

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What are the model rules and how do they work?

The Office of Fair Trading has developed model rules, which cover the matters required by Schedule 1 of the Act as well as a number of additional matters. These rules may be adopted ‘as is’ at the time of incorporation. An existing association can change its rules to the model rules.

The model rules do not suit every association. Therefore, any association proposing to adopt the model rules should carefully consider whether the model rules suit the purposes of the association.

Associations that do not adopt the model rules should be aware that where the model rules make provision for a matter but the rules of the incorporated association do not make provision for that matter, the relevant model rule will form part of the rules of the incorporated association. To avoid possible confusion or disputes, it is important the rules of an association deal with the matters set out in the model rules (although not necessarily in the same manner as the model rules).

The model rules may be amended or updated by Regulation from time to time. Any such amendment will apply to any association that has adopted the model rules.

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What is the distinction between rules and by-laws?

The Act makes no distinction between the rules and by-laws of an incorporated association. Changes to both the rules and by-laws are required to be made by way of a special resolution.

An association involved in a sport or other competition may wish to set out its playing or competition rules other than in its rules or by-laws to avoid the need to pass each change to the playing or competition rules by way of a special resolution and registered in order to have effect.

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How are the rules of an association changed?

The rules of an incorporated association may be changed by way of a special resolution (see the Resolutions information page for further information regarding special resolutions). When considering changes to the rules care needs to be taken to ensure the alterations are consistent with the Act and other rules of the association.

Within one month after the passing of the special resolution altering the rules, the public officer of an incorporated association must lodge with the Registry of Co-operatives & Associations:

  • a Notice of Alteration of Objects or Rules (Form 6), and
  • the prescribed fee.

The alteration to the rules takes effect when the notice is properly lodged with the Commissioner for Fair Trading and the lodging party will be notified of this.

The Registry does not provide legal advice regarding the rules of an incorporated association and does not inspect rules lodged by associations to ensure compliance with the Act.

The person lodging the Notice of Alteration of Objects or Rules is required to certify the rules comply with the Act by providing for the matters specified in Schedule 1 of the Act.

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What happens if the association fails to comply with its rules?

The rules of an association bind the association and its members in the same way as a contract and each member agrees to observe all of the provisions of the rules.

A breach of the rules means that there may be an action that an individual member may take in respect of that breach. Alternatively, the members may deal with any breach of the rules under the rules of the association.

In most cases, the Registry does not have the authority under the Act to investigate or to intervene if a dispute arises as a result of an alleged breach of an association’s rules. For further information, concerning the handling of disputes see the information page on Resolving Disputes.

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