SANDY ADIRONDACK
Legal and governance training and consultancy
for the voluntary sector
OTHER CHAPTERS
I. THE ORGANISATION

Ch.1: Setting up an organisation
Ch.2: Unincorporated organisations
Ch.3: Incorporated organisations
Ch.4: Charitable status, charity law & regulation
Ch.5: The organisation's objects
Ch.6: The organisation's name
Ch.8: Registering as a charity
Ch.9: Branches, subsidiaries & group structures
Ch.10: Changing legal form
Ch.11: Collaborative working, partnerships and mergers
II. GOVERNANCE
Ch.12: Members of the organisation
Ch.13: Members of the governing body
Ch.14: Officers, committees & sub-committees
Ch.15: Duties & powers of the governing body
Ch.16: Restrictions on payments & benefits
Ch.17: The registered office & other premises
Ch.18: Communication & paperwork
Ch.19: Meetings, resolutions & decision making
Ch.20: Assets & agency
Ch.21: Contracts & contract law
Ch.22: Risk & liability
Ch.23: Insurance
Ch.24: Financial difficulties & winding up
III. EMPLOYEES, WORKERS, VOLUNTEERS & OTHER STAFF
Ch.25: Employees & other workers
Ch.26: Rights, duties & the contract of employment
Ch.27: Model contract of employment
Ch.28: Equal opportunities in employment
Ch.29: Taking on new employees
Ch.30: Pay & pensions
Ch.31: Working time, time off & leave
Ch.32: Rights of parents & carers
Ch.33: Disciplinary matters, grievances & whistleblowing
Ch.34: Termination of employment
Ch.35: Redundancy
Ch.36: Employer-employee relations
Ch.37: Employment claims & settlement
Ch.38: Self employed & other contractors
Ch.39: Volunteers
IV. SERVICES & ACTIVITIES
Ch.40: Health & safety
Ch.41: Safeguarding children & vulnerable adults
Ch.42: Equal opportunities: goods, services & facilities
Ch.43: Data protection & use of information
Ch.44: Intellectual property
Ch.45: Publications, publicity & the internet
Ch.46: Campaigning & political activities
Ch.47: Public events, entertainment & licensing
V. FUNDING & FUNDRAISING
Ch.48: Funding & fundraising: General rules
Ch.49: Fundraising activities
Ch.50: Tax-effective giving
Ch.51: Trading & social enterprise
Ch.52: Contracts & service agreements
VI. FINANCE
Ch.53: Financial procedures & security
Ch.54: Annual accounts, reports & returns
Ch.55: Auditors & independent examiners
Ch.56: Corporation tax, income tax & capital gains tax
Ch.57: Value added tax
Ch.58: Investment & reserves
Ch.59: Borrowing
VII. PROPERTY
Ch.60: Land ownership & tenure
Ch.61: Acquiring & disposing of property
Ch.62: Business leases
Ch.63: Property management & the environment
VIII. BACKGROUND TO THE LAW
Ch.64: How the law works
Ch.65: Dispute resolution & litigation
UPDATED INFORMATION FOR CHAPTER 7:
THE RUSSELL-COOKE
VOLUNTARY SECTOR LEGAL HANDBOOK

This page contains information that has appeared on Sandy Adirondack's legal update website for voluntary organisations at www.sandy-a.co.uk/legal.htm. For current updates, including potential changes that are in the pipeline, see the legal update website.

These websites for each chapter update the 3rd edition of The Russell-Cooke Voluntary Sector Legal Handbook by James Sinclair Taylor and the Charity Team at Russell-Cooke Solicitors, edited by Sandy Adirondack (Directory of Social Change, 2009). The websites are not intended as a comprehensive update and should not be treated as such.

To order a copy of The Russell-Cooke Voluntary Sector Legal Handbook, print out the order form at www.sandy-a.co.uk/bookserv.htm or send an email order by clicking . It costs £60 for voluntary organisations or £90 for others, plus 10% p&p.

To avoid spamming, an email address is not given on screen. If you can't see the word 'here' or have trouble sending an email by clicking on it, the address is bookservice at sandy-a.co.uk, with the spaces and 'at' replaced by the @ symbol.

The information here covers the law applicable to England and Wales. It may not apply in Northern Ireland and/or Scotland. These news items are not a full or definitive statement of the law and are not intended as a substitute for professional legal advice. No responsibility for loss occasioned as a result of any person acting or refraining from acting can be taken by the author.


Chapter 7
THE GOVERNING DOCUMENT


The items below formerly appeared on the legal update website for voluntary organisations and are archived here. The content may be out of date and links may not work. For current updates to the chapter, see the legal update website for voluntary organisations at www.sandy-a.co.uk/legalstatus.htm.


MODEL ARTICLES OF ASSOCIATION

Updated 26/3/2011. This information updates s.1.5.3 in The Russell-Cooke Voluntary Sector Legal Handbook (VSLH3).
For companies formed on or after 1 October 2009, the articles of association are significantly different than they would have been before this date. New companies, whether charitable or non-charitable, should take specialist advice about whether to use one of the new model articles, and if so whether they need to be adapted to ensure they are appropriate for the company. If model articles are not used, legal advice is essential — it is not wise to try to draw up articles without such advice, as they may not comply with the Companies Act 2006 and, for charitable companies, the Charities Act 2006.

The Companies (Registration) Regulations 2008, containing the memorandum and statements that are needed for registration, are at www.opsi.gov.uk/si/si2008/uksi_20083014_en_1.

The Companies (Model Articles) Regulations 2008 are at www.opsi.gov.uk/si/si2008/uksi_20083229_en_1. These include model articles for a public company, private company limited by shares (intended for an owner-managed business), and private company limited by guarantee (intended for not-for-profit companies, including voluntary sector companies). These are available in Word format on the Companies House website, via tinyurl.com/ych9vby.

However, these company law model articles do not include anything that is in the Companies Act — so the rules on the notice period for general meetings, for example, or for written resolutions are not in the model articles. This means that company directors, the company secretary if there is one, and anyone who deals with company administration all have to know the Companies Act provisions or need to know where to find them in the Act or in a reference book. For most voluntary organisations it is likely to be better to use a model that includes the relevant statutory provisions.

In addition, the Companies Act model articles for a company limited by guarantee do not include provisions required under charity law or recommended by the Charity Commission. The Charity Commission issued in August 2010 a revised version of the new model articles for charitable companies (GD1), which it had originally issued in September 2009. These include provisions which the Commission says ensure compliance with both charity law and company law, in particular in relation to the provision of payments and benefits for directors/trustees and persons connected with them, and in relation to directors'/trustees' conflict of interest and conflict of loyalties. The model articles are on the Charity Commission website via tinyurl.com/6525t3a.

An alternative to the Charity Commission's model articles is the Charity Law Association's model, which was published on 5 March 2010 and is approved by the Charity Commission. It is available free of charge to CLA members, or for £15 in hard copy or £40 for hard copy plus a Microsoft Word version on disk, from the CLA. The CLA can be contacted via its website at www.charitylawassociation.org.uk.

As well as the Charity Commission's general guidance for registering new charities, including charitable companies, at tinyurl.com/yc2kvkh, there is also guidance on incorporating an existing unincorporated charity at tinyurl.com/y9gdu2w.

For charitable companies in Scotland, SCVO (the Scottish Council for Voluntary Organisations) has updated its model articles, accessible via tinyurl.com/yask8js.


MODEL GOVERNING DOCUMENTS

Added 11/1/12. This information adds to s.7.2 in The Russell-Cooke Voluntary Sector Legal Handbook (VSLH3).
The Charity Commission issued, in June 2011, updated versions of its model constitution, trust deed and articles of association. All of the Commission's model governing documents — including the model constitutions for charitable incorporated organisations now:

  • allow a trustee or connected person to be paid for supplying goods to the charity (in addition to the statutory power for them to provide services, and goods connected with those services);
  • allow a trustee or connected person to be employed or remunerated by the charity, subject to the Commission's prior authority;
  • include the same provisions for dealing with conflicts of interest and conflicts of loyalties;
  • allow a minority of the trustees to receive financial benefits (money, or benefits with a monetary value) as beneficiaries of the charity;
  • encourage members of the charity to resolve internal disputes themselves or by using mediation before resorting to litigation (trusts do not have members, so the model trust deed refers to disputes between the trustees);
  • make it clear that charities in England and Wales but also operating in Scotland or Northern Ireland must not use their resources for purposes that are not charitable in those countries.
The model governing documents can be accessed via tinyurl.com/p6tfllb [link updated 25/5/13 for Charity Commission's new website] .

Charities Act 2006
AMENDING A CHARITABLE COMPANY'S MEMORANDUM AND ARTICES


Updated 26/4/09. This information is included in s.7.5.3 in The Russell-Cooke Voluntary Sector Legal Handbook (VSLH3).
From 18 March 2008 the Charities Act 1993 requirement to obtain prior Charity Commission consent for any change in the memorandum or articles of association "directing or restricting the manner in which the property of the company may be used or applied" no longer applies. Consent is required only for changes to the objects clause, changes relating to use of property when the company is dissolved, or changes relating to the provision of benefit to directors, members of the company or persons connected with them.

This provision is in s.31 of the Charities Act 2006, which amends s.64 of the Charities Act 1993.

The Companies (Model Articles) Regulations 2008, at www.opsi.gov.uk/si/si2008/uksi_20083229_en_1 come into effect on 1 October 2009 and include model articles for a private company limited by guarantee. However these should not be used for charitable companies. Charitable companies which wish to amend the memorandum and articles now should take specialist legal advice or use the Charity Commission's model memorandum and articles at tinyurl.com/cvb5hn. Charitable companies that want their articles to fully reflect the October 2009 changes in company law should wait until the Charity Commission's and/or Charity Law Association's revised models are available.


| Home | About Sandy | Publications | Open training | Current courses | In-house training | Consultancy | Mentoring | Books by post |
| Legal update | Legal update (activities & services) | Legal update (employment & volunteering) | Legal update (equality & human rights) | Legal update (risk, finance, funding & property) | Legal update (legal structures & charitable status) | Legal update (archived items) |


2009-2011 Sandy Adirondack.
To avoid spamming, an email address is not given on screen. If you can't see the word 'Sandy' or have trouble sending an email by clicking on it, the address is sandy at sandy-a.co.uk, with the spaces and 'at' replaced by the @ symbol.

SANDY ADIRONDACK
Governance and legal training and consultancy
for the voluntary sector

39 Gabriel House, 10 Odessa Street, London SE16 7HQ
Tel 020 7232 0726; fax 020 7237 8117
Email:
Web: www.sandy-a.co.uk