New Association rules for Material Personal Interests

A raft of new provisions were introduced recently under the Associations Incorporation Act 1991 (ACT), and notably those which deal with material personal interests. Here is what you need to know.

What are material personal interests

Committee members have obligations (and are subject to penalties) under Part 4 of the Act that relate to:

  • declaring material personal interests; and
  • managing material personal interests.

Material personal interests are those where a member has a conflict of profit or duty.  This may be:

  • a financial conflict e.g. holds shares in a company that the association is dealing with; or
  • a duty of conflict e.g. a person is a member of two associations/organisations doing business together.

Moreover, conflicts can be actual, perceived or potential interests.

Committee/Board Meetings

Where there is a material personal interest in a matter being considered at a committee meeting, that member must as soon as they are aware of the interest:

  • disclose both the nature of and extent of the interest to the committee; and
  • disclose the same information at the next general meeting of the association.

Additionally, where there is a material personal interest, that member must:

  • be excluded from the meeting while the matter is being considered; and
  • must not vote on the matter.

General Meetings

As noted above, where a material personal interest is disclosed at a committee meeting, it must be disclosed at the next general meeting of the association. That is, a member must be told of the material personal interest. As we approach AGM season, this effectively creates a new agenda item for many Associations.

Keeping track declared interests

The Act specifies that a declared interest should be recorded in the minutes of the meeting at which the disclosure is made.

Additionally, it is good practice to:

  • ask all new committee members to declare actual, or potential conflicts of interests when joining and record these in the register;
  • review the register of conflicts whenever the association has dealings with new businesses or organisations.

Please contact us if you would like to discuss how this affects you or your Association.

Parental Leave for Casual Employees

For casual employees the unpredictability of their employment can be a major source of stress as often casual employees miss out on many of the entitlements that full-time and part-time employees enjoy. For many, this concern is further exacerbated when they learn that they are about to become a parent. It should therefore be of …
Read more

Purchasing an Off-the-Plan Property

The interest in “off-the-plan” properties is ever increasing and is becoming more popular for buyers. An off-the-plan purchase is one where the Buyer enters into a contract to purchase a property that has not yet been constructed. Due to the prolonged settlement period for an off-the-plan purchase it is imperative for buyers and sellers to …
Read more