Personal Representation.
Proven Results.

divider

Blog

separator

Does Your Community Civic Group Need to be Registered With the State


I’ve recently received an inquiry about the ability of an unincorporated association to file suit on behalf of the association. There are, of course, many types of groups which are true organizations that have bank accounts, enter into contracts and act in the same manner as a business might without being registered with the state. These groups might include sports teams, homeowners associations, civic clubs, some charitable organizations, or an online message board group. These associations are not necessarily small. An athletic conference or youth sports league could conceivably act as an unincorporated association as could a huge charity event that does not fall under 501(c)(3) protection.

Unincorporated nonprofit associations do have the right to be involved in civil litigation as associations in their own names, even if they are not incorporated with the state. This is interesting as there is also a statute in North Carolina which requires certain businesses to be registered with the state in order to file suit. North Carolina law also allows these unincorporated nonprofit associations certain additional rights, such as the ability to hold and transfer real and personal property and the ability to shield their individual members from personal liability. In short, you can obtain many of the benefits and protections of corporate status without actually being on file with the state – so long as you are a non-profit.

In order to be treated as an unincorporated nonprofit association such that they are eligible for this protection, the association must consist of two or more members joined by mutual consent for a common nonprofit purpose. This is a very broad definition: nothing must be in writing, the organization technically doesn’t even need to have a name.

If you are an organization that maintains funds, enters into contracts, but is not for profit, it may make sense for your organization to act as an unincorporated non-profit association as opposed to registering with the state. There are of course benefits to registering as well. To learn more about the benefits of each, contact Maginnis Law, PLLC for a consultation with an experienced civil lawyer. Maginnis Law, PLLC is a Raleigh business litigation firm that handles matters in Cary, Holly Springs, Morrisville, Wake Forest, Clayton and other surrounding areas of Wake County and Johnston County. Contact the firm at 919.526.0450 to speak with a business attorney about your matter or organization. Alternatively, visit our website at www.maginnislaw.com to get more information.

separator

separator