Liability of management committee members

Members and office bearers of the association are generally not liable for the debts or liabilities of the association. Debts are most commonly incurred as a result of a contract it has entered into. An association may also incur a liability if sued. For example negligent acts done by the management committee, employees or volunteers.

Management committee members are not immune from personal liability and if a committee member or officer acts in bad faith or contrary to the rules of association, he or she may personally be criminally prosecuted or be the subject of civil proceedings. For example if an officer enters into a contract against the instructions of the management committee.

Likewise, if a committee member is negligent in the performance of their office, they may be held personally liable for any resulting loss or damage.

It is possible for incorporated associations to adopt rules which indemnify committee members against breaches of their duties to the association and/or against liability to third parties. Before an indemnity is granted, the association should consider their objects and make an assessment of the risks the organisation may face.