Limited Company

[Crazyface]

We've got a meeting called at ours 30th Nov to discuss moving the club to be a limited company? They (those who hold the power) have tried this before, (not that I remembered but just happened to come across an old AGM letter last night 2014) and it must have got kicked out.

Why would they want to do this?
Is it a good idea?
Will we have to vote for directors?
Will the membership lose control? (not that they have any as those in charge do what they want £7K used from a bank loan to build a new tee of the 2nd that was not required and is now classed as dangerous....'kin clowns).

 

[El Diablo]

This is quite a good summary of why you should do it - really is the best thing to do in our modern world.

http://www.thegolfbusiness.co.uk/2011/10/should-clubs-become-limited-companies-to-reduce-liability/

 

[Deleted member 15344]

Going limited compnay is crucial for personal liability

If for any reason our club was sued and found in favour of the defendant then each member would be liable for the full costs - if the club required to be sold due to the findings and still didnt cover the costs then each member would need to dig into their pockets and pay up.

Going limted reduces your liable down to a specific amount - ours is £1 so no matter what happened the maxium any member would need to pay would be a £1

 

[Crazyface]

Won't we then need directors.......who can then wield power.

 

[chrisd]

No bad thing in my opinion. We are a private members club and some committee members become directors and are replaced as and when necessary. The Club is still run as a club with the members having voting rights at AGM's etc. There is obviously limited liability, but it's wise to ensure that the Club insurance covers all the risks that members/directors may face.

 

[Jates12]

It would become limited without share capital. There would potentially be "Directors" but you already have a board in place who make decisions, its very easy to change directors on companies house and these can be changed when board members/committee members move on.

 

[El Diablo]

The split of roles between board and committees is another important step that needs to be defined - who makes decisions and how are they approved.

Ultimately the board of directors are elected by and accountable to the member/shareholders - companies have articles of association (like club constitution) which can lay down what the board can or cannot do without going to you for approval etc.

I have seen various splits between the committees and the boards in terms of roles and responsibilities, separate, combined, heads of committees being directors etc. and there are pros and cons.

Agree on the principle to become limited and then have working group to define shape of it and come back to members to vote etc.

Ultimately I think you would see little or no difference over what happens today.

 

[Crazyface]

The split of roles between board and committees is another important step that needs to be defined - who makes decisions and how are they approved.

Ultimately the board of directors are elected by and accountable to the member/shareholders - companies have articles of association (like club constitution) which can lay down what the board can or cannot do without going to you for approval etc.

I have seen various splits between the committees and the boards in terms of roles and responsibilities, separate, combined, heads of committees being directors etc. and there are pros and cons.

Agree on the principle to become limited and then have working group to define shape of it and come back to members to vote etc.

Ultimately I think you would see little or no difference over what happens today.

More sort of putting it on a stronger foothold.

 

[Doh]

Our directors are voted in on a annual basis anyone can put themselves up for election as long as they have a proposer and seconder.
The directors then form the committee, although there are some positions that are in place for three years which helps with continuity. On second thoughts it's just the Chairman who does three years.

 

[Maninblack4612]

Won't we then need directors.......who can then wield power.

Our club is a company limited by guarantee, very common for clubs. Nothing changes. We have a committee, who also become directors and the club runs in the same was as it would if it were constituted differently. As has already been said, this protects the members who, in the event of failure, are only liable, in our case, for £1 each.

 

[jim8flog]

Ours is a limited company with a members liability of just £1.


You do need Articles of Association in which it is specified as to what the Directors Roles are this can be agreed prior to going to a Ltd Co by the members. It is best that these are drawn up by a specialist solicitor.

Our directors are limited to a 3 year period after which they can stand again for election. Anything they want to 'bring in' which changes the club's constitution has to be passed at EGM.

 

[Lord Tyrion]

Would you need to add vat to the fees? Currently running at 20%.

 

[backwoodsman]

Won't we then need directors.......who can then wield power.

That's an emotive way of putting it, but yes. But in effect, no different to what you (probably) already have. Clubs can't run on a one person one vote basis on every decision. You need an "executive" group to make decisions. And its up to the club as a whole to decide the system of how those people get to be on that executive. Which is true whether that executive is a "committee" or a "board".

But being a limited company is a good move.

 

[Maninblack4612]

Would you need to add vat to the fees? Currently running at 20%.

Whether the club pays VAT depends on the club's turnover, not it's limited liability status.

 

[jim8flog]

Would you need to add vat to the fees? Currently running at 20%.

Not for members. They are part owners of the club so no VAT payable, it's paying a share of the expenses to run the club.