Political parties as unincorporated association
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What are the legal issues of political parties as unincorporated associations? Especially for resolving disputes with or without recourse to the courts. The issues surrounding Corbyn's leadership election prompted me to raise this.
https://www.gov.uk/business-legal-structures/unincorporated-association
jondwhite wrote:What are the legal issues of political parties as unincorporated associations? Especially for resolving disputes with or without recourse to the courts. The issues surrounding Corbyn's leadership election prompted me to raise this.As we are discussing legal issues, what is the legal position of a political party leader? Does he/she overide the powers of general secretary, chairman, treasurer etc? Is this is a case of keeping a dog and letting it do the barking?
Well, the legal issue is that technically, the party doesn't exist. The good news is that it limits the liabilities of members to their voluntary donation, the bad news is the trustee is liable for all the parties debts (in strict terms, all the property of the party belongs to the trustees personally, as individuals, and we are the ones who get taken to court if anyone sues the party as a party – the party did get sued once for libel).In terms of the issue of courts: basically, the law of contract applies, and where not contract, the principles of justice and equity. So, if, say, a HOO one day changed the locks, and pevented the gen sec coming in, the Gen sec could say they were sacked without due process, and without the rulebook being followed. They could appeal to the courts for redress.Likewise, if the EC decided to spend the parties money on a visit to a brothel, the courts could stop that as it wiouldn't be money spent in keeping with the object of the party.The big lesson of the Labour fiasco, is don't change the rules as a procedural fix, and make the rules as clear as possible.
Young Master Smeet wrote:Well, the legal issue is that technically, the party doesn't exist. The good news is that it limits the liabilities of members to their voluntary donation, the bad news is the trustee is liable for all the parties debts (in strict terms, all the property of the party belongs to the trustees personally, as individuals, and we are the ones who get taken to court if anyone sues the party as a party – the party did get sued once for libel).In terms of the issue of courts: basically, the law of contract applies, and where not contract, the principles of justice and equity. So, if, say, a HOO one day changed the locks, and pevented the gen sec coming in, the Gen sec could say they were sacked without due process, and without the rulebook being followed. They could appeal to the courts for redress.Likewise, if the EC decided to spend the parties money on a visit to a brothel, the courts could stop that as it wiouldn't be money spent in keeping with the object of the party.The big lesson of the Labour fiasco, is don't change the rules as a procedural fix, and make the rules as clear as possible.Thanks very much, this was exactly what I was getting at.
Quote:As will emerge below, what is essentially required of the court is its interpretation ofone particular clause in the current Labour Party Rule Book (‘the Rule Book’) in thecontext of the rules as a whole. It is therefore a very narrow legal issue. It is uponthat issue that this ruling is focused. All other matters are irrelevant unless they areneeded to help in arriving at the correct interpretation of those rules. Even then,anything that is arguably to be regarded as “political” would be approached with veryconsiderable caution by any court and, as will be apparent in due course, had it beennecessary for me to consider matters that might have trespassed into the politicalarena I would have trodden a very cautious path. Mr Westgate quite rightly said thatthe court should be extremely careful not to find itself picking sides in a politicaldebate.and this beauty:
Quote:The Rule Book runs to some 84 pages and contains a wide range of provisions. I do not know to what extent it was drafted with legal assistance, but the expression “without prejudice to” appears in three places and “for theavoidance of doubt” in five places, both expressions commonly used by lawyers. The expression “null and void” appears in six places and the word “deemed” appears in many places. The inference I draw is that that there has over the years been some legal input into its drafting. What is, however, certain is that it has been altered by various amendments (some major, some minor) over the years and it therefore represents something of an amalgam of instances of drafting at various times: it was not the product of one drafting exercise. That may be of some importance when considering some issues raised in theseproceedings (see paragraph 53 below).And this is important:
Quote:owever, I find it difficult to understand how a court could conclude that an erroneous interpretation of the rules was reasonable: a conclusion of law is either right or wrong and a memberof an unincorporated association has the right to ask the court for its decision.The rulebook is a contract:http://www.bbc.co.uk/news/uk-politics-37009871?ns_mchannel=social&ns_campaign=bbc_breaking&ns_source=twitter&ns_linkname=news_central
Quote:Delivering his judgement, Mr Justice Hickinbottom ruled that refusing the five the vote "would be unlawful as in breach of contract".https://www.judiciary.gov.uk/wp-content/uploads/2016/08/evangelou-v-mcnicol-20160808.pdfSome useful law:
Quote:It is well-established that:i) A person who joins an unincorporated association does so on the basis that he will be bound by its constitution and rules, if accessible, whether or not he has seen them and irrespective of whether he is actually aware of particular provisions (John v Rees [1970] 1 Ch 345 at page 388D-E).ii) The constitution and rules of an unincorporated association are generally regarded as intended to be comprehensive, and further terms will not readily be implied (Dawkins v Antrobus (1881) 17 Ch D 615 at page 621 (“Dawkins”) per Sir George Jessel MR, without demur from the Court of Appeal on appeal).iii) The constitution and rules of an unincorporated association can only be altered in accordance with the constitution and rules themselves (Dawkins at page 621, Harrington v Sendall [1903] Ch 921 at page 926 and Re Tobacco Trade Benevolent Society (Sinclair v Finlay) [1958] 3 All ER 353 at page 355B-C).iv) The proper interpretation of the constitution and rules of an unincorporated association, like any other contract, is generally a matter of law for the court. The court focuses on the wording of the contract as it stands. If the words are clear and unambiguous, then there is no need to look outside them. However, if the natural and ordinary meaning of the words is unclear or ambiguous, then the court will consider the relevant context, being concerned to identify the intention of the parties by reference to “what a reasonable person having all background knowledge which would have been available to the parties would have understood them to be using the language in the contract to mean” (Chartbrook Limited v Persimmon Homes Limited [2009] UKHL 38 at [14] per Lord Hoffmann; recently approved in Arnold v Britton [2015] UKSC 36 at [15] per Lord Neuberger of Abbotsbury PSC). I consider this proposition, uncontroversial so far as it goes, in the context of the specific provisions of the Rule Book below (see paragraphs 14-16).Also worth noting is the judge's use of minutes, reports and conference decisions (as well as procedural history). It is a pretty neat take down on shabby procedural manoeuvring. Some Labour rights now bleating about he left using 'the establishment courts', or nicking their toys, as it should be known.
jondwhite wrote:Can the Labour party NEC ignore the ruling and just rewrite the rules to suit themselves?They could but then they would most likely be held in contempt for ignoring the court ruling.
Just for the record:https://www.judiciary.gov.uk/wp-content/uploads/2016/08/evangelou-v-mcnicol-appeal-judgment-20160812.pdf
Quote:The Labour Party is an unincorporated association. As such, it has no separate legal personality from that of its individual members and as a matter of law is not a legal entity distinct from them, as it would have been had it been a company or an industrial and provident society. It is, however, subject to rules, currently those in the 2016 Rule Book.Quote:19. The nature of the relationship between an unincorporated association and its individual members is governed by the law of contract:- (a) The contract is found in the rules to which each member adheres when he or she joins the association: see Choudhry v Tresiman [2003] EWHC 1203 (Comm) at [38] per Stanley Burnton J.Quote:In the present case, there is no challenge to the rationality of the eligibility criteria and the freeze date, and they are only said to be unauthorised on the true construction of the contract. It is, however, relevant to note that a discretion conferred on a party under a contract is subject to control which limits the discretion as a matter of necessary implication by concepts of honesty, good faith and genuineness, and need for absence of arbitrariness, capriciousness, perversity and irrationality: see Sochimer International Bank Ltd v Standard Bank London Ltd [2008] EWCA Civ 116, [2008] Bus LR 134 at [66] and Braganza v BP Shipping [2015] UKSC 17, [2015] 1 WLR 1661, and the cases on mutual undertakings and bodies exercising self-regulatory powers mentioned at [47] below{my emphasis)
Quote:“It is plain from these authorities that a decision-maker’s discretion will be limited, as a matter of necessary implication, by concepts of honesty, good faith, and genuineness, and the need for the absence of arbitrariness, capriciousness, perversity and irrationality. The concern is that the discretion should not be abused. Reasonableness and unreasonableness are also concepts deployed in this context, but only in a sense analogous to Wednesbury unreasonableness, not in the sense in which that expression is used when speaking of the duty to take reasonable care or otherwise deploying entirely objective criteria … ”.and
Quote:That approach was applied in Braganza v BP Shipping [2015] UKSC 17, [2015] 1 WLR 1661, in which Baroness Hale stated that the principles to be applied were the same as those applied in public law cases, i.e. not only that the decision is made rationally and in good faith, but also that it is made consistently with its contractual purpose and, we add, that all relevant matters have been taken into account and irrelevant matters not taken into account.So Wednesdbury unreasonableness applies (and would be said to apply to our EC.:
Quote:(a decision) So outrageous in its defiance of logic or accepted moral standards that no sensible person who had applied his mind to the question to be decided could have arrived at it.https://en.wikipedia.org/wiki/Associated_Provincial_Picture_Houses_Ltd_v_Wednesbury_Corp
Do Leninist parties tend to be incorporated associations?If I recall correctly, the SWP is operated through a web of companies including Sherborne Publications with Callinicos as a director. Votes are taken at gerrymandered conferences but the chances of unseating the director are slim.The image of the web of companies was previously posted here but seems to have disappearedhttps://www.urban75.net/forums/threads/swp-expulsions-and-squabbles.303876/page-441
Unincroporated associations don't exist, as the judges said, really it's personal contract law (so our rulebook is a cntract between each member of the party); some Leninist organistion would be trated as such under the law, but if they set themselves up as a company, then they a a corporate entity, and would be regulaed under corporate law.Sadly, as this court ruling shows, the leninist model of party can be upheld within the law, so long as all members sign up to a rule book giving the CC sweeping powers (subject to fairness, reaonableness, etc.).
Can't the courts uphold the Leninist model even if members don't agree to the rulebook giving the CC sweeping powers, provided the suit is against Sherborne Publications inc. for membership control over Socialist Review for example. Sherborne Publications Inc. makes no pretense of operating democratically and has a CC member as its director?
By joining your are assumed to have approved of the rulebook, whether you have been provided with a copy or not (I think I posted a quote to that effect earlier). The court would uphold the corporate charter of Sherborn Publications.
Quote:* * * * * * * * * * COMPANY INFORMATION * * * * * * * * * *INCORPORATION DATE: October 10, 1991 JURISDICTION/PLACE OF REGISTRATIONEngland/Wales LEGAL STATUS: Private Limited with share capital OPERATING STATUS: Small company ; Live companyApparently there are 100 shares, between, currently, 2 people. Simon Basketter and Roger Cox. As of this year, it had net assets of -361,000, with no turnover. The assets on hand fell from 126K to 88K, last fin. year.Anyway, those are the only 2 who would have poer to vote out a director: arguably they might be bound by contract to obey the CC, but it would be fascinating to see that go to court…
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