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Club Law and Management

by Philip Smith, Secretary of the A.C.C.

Questions and Answers

Q. Our Club runs a free membership draw every Saturday night for a prize of £10. To win, the member must be in the Club. If they are not, the draw gets carried over until the following Saturday wherby a further £10 is added. This has on occasion accumulated to hundreds of pounds. Is the legal?

A.  I can confirm that there is
nothing wrong with a draw of this nature.

As a Private Members’ Club
you are entitled to run free lotteries of this type as often as you wish. As this is a free draw
it is does not encounter the
usual problem with snowball prizes in that they may break the ‘equal chance’ gaming rule. This ‘equal chance’ gaming
rule is concerned with persons who may have contributed to the earlier games but may have no chance of winning the subsequent games. As, in this
case, the whole membership list is used every time and no member has risked any money then this rule is not breached as all members have an equal chance of winning.

The fact that a member may not be present in the Club when the draw is called does not affect the fairness of the  draw. The conditions of the draw make it
clear that the person must be
present to win a prize and if these
conditions are not fulfilled then they forfeit the prize and it is carried over to the next week.

 

Q. When we hire out a room with a bar for a function, can we charge higher prices than we normally do?

A. I confirm that it is possible for Clubs to have different prices lists in different bars when, for example, a room is on private hire.

This is not unusual and I have found that most Clubs will, on average, charge an additional 10% across the board on drinks severed from a bar when a private hire is in place. This is only possible, of course, in Clubs where the bars in such rooms are entirely separate otherwise it is impractical to achieve.

 

Q. The Committee would like to know if we can introduce the following as a bye-law or if it can only be introduced by way of an amendment of Rules through a vote at a Special or Annual General Meeting: 'Any committee person who resigns during their terms of office cannot stand for re-election or be co-opted back onto the committee for two years from their date of resignation.'

A. Whilst I completely understand the intention of the bye-law I can confirm that it is not possible for a bye-law to be created by the Committee which, in effect, is contrary to a Rule of the Club or which seeks to amend or alter the Rule of a Club.

I have no objection to the intention of the proposal but I must point out that it could only be authorised with the approval of Members in accordance with the Rule amendment procedure set out under the Rules.

Q. At the last Committee meeting it was decided by a close vote that we would not change from our normal opening hours over the August bank holiday. However, five Committee Members then had a 'un-offical' Committee Meeting and voted to open all day. Can they do this?

A. I have to advise you that the action of these Committee Memebers was completely out of order and unacceptable. The fact that the Rules state that the five members of the Committee (which includes officers) are required to form a quorum does not mean that five Officers or Commitee Members meeting together at any time can implement policy. The quorum requirement is that five Officers or Committee members must be present at a convened Committee Meeting in order to qualify the meeting as being competent to transact business.

Any decision that may need to be made between the mettings is usually dealt with by the Officers, and is subsequently reported at the next Committee Meeting for ratification or otherwise. The fact that these five took upon themselves to act independently of the Committee at a Meeting that had not been called by the Secretary and arbitrarily overturned a previously agreed decision is one which should not be repeated.

 

Q. A member of our Club's Committee has asked why the local rugby club, which he is a member of, benefits from a preferential rate charged by Sky TV and we do not. Is the ACC able to negotiate such a rate for our Clubs?

A.  I confirm that clubs affiliated to the RFU enjoy a preferential rate with Sky as a result of a centrally negotiated deal between Sky and the RFU. You will appreciate that RFU matches are shown on Sky TV and consequently they are in a rather better negotitating position than we are. I understand that similar agreements are in place with cricket clubs.

You will appreciate that both these Clubs are affiliated to sporting bodies which do business with Sky. In other words people watch rugby and cricket. However, the reality is that Club's such as ours have nothing to sell to sky.

Unfortunately, Sky has not been prepared to enter into any negotiation for discounted rates for our collective type of members' club. Indeed the number of such Clubs now showing Sky has reduced significantly but this has still not helped with negotiations. I am afraid that Sky have consistently over-promised and under-delivered to private members' clubs.

Q. Due to falling Membership levels a new member of our Committee has suggested that we try to 'recruit' new members from several new housing complexes that have been built in and around our area. Another member of Committee has advised that our Rule book states that any new member joining needs to be known by and proposed and seconded by two current members. Is there a way that we can work around this rule?

A. Technically the Member in question is correct in stating that Candidates for Membership must be known to their proposers and seconders. However, if Members are unwilling to recruit new Members then the Club will not survive in the long term. The Club may promote the occasional Open Day during which Members of the Public could be invited in to view the Club and as such events could be meet Members and in particular Members of the Committee who may feel able to get to propose them as Candidates. I am sure that in most cases a bit of common sense is all that is required and if the occasional unsuitable Member slips through the net, they can soon be dealt with under the rules. If an Open Day is arranged, it will need to have a Temporary Event Notice in place.

 

Q. Is it possible to vote by proxy at an Annual General meeting?

A. I Confirm that under the rules of the Club Proxy Voting is not permitted. There is no provision for either Proxy or Postal Voting at either General Meetings or Committee Meetings of the Club.

 

Q. We have a long standing Trustee with health problems who has not renewed his membership for the last year and with whom we have no contact for some time. We have written to him twice asking if he wishes to relinquish his post as Trustee but have had no reply. Can you advise what steps we are now able to take?

A.  The only way in which to remove the Trustee in question is to either seek his resignation, which is unlikely to be forthcoming, or to remove him from office at a Special General Meeting called for that purpose in accordance with your rules. At the same meeting the Memebers could elect a new Trustee.

 
 

Dates For Your 2011 Diary

Club Secretaries will have in their minds – and hopefully in their diaries – the dates by which  certain returns and applications will have to be made. I hope the following check list will assist Clubs in carrying out this useful exercise.

Club Premises Certificate

All Clubs are now in possession of a Club Premises Certificate granted under the Licensing Act 2003. Whilst there is no specific renewal date of a Club Premises Certificate in the same way as the previous Registration Certificates, it is necessary for an annual fee to be paid to the local Licensing Authority in order for the Club Premises Certificate to remain in force.  Therefore, look out for any renewal invoice received from your local Licensing Authority and
ensure that it is paid promptly.

Performing Rights Society & Phonographic Performances Ltd

The PRS and PPL Licenses need to be renewed each year. These Licenses cover different types of copyright payable for playing any type of music within the Club. There are two types of license required to be paid to the PPL depending on whether the Club plays background music or uses recorded music at a dance or discotheque or similar function. In the case of the latter, the fee is on a sliding scale basis.

In January, fees are payable to the PRS. These payments are fixed under an Agreement with the PRS and the  appropriate fee for a Club is calculated according to the type of music used. There is often confusion between the licenses of the PPL and PRS but, as a general rule, if a Club has music it must have both of these respective licenses.

Gaming Machines

The Gambling Act 2005 which came into force on 1st September 2007, replaced Part III  Gaming Machine Registration Certificates with Club Gaming Machine Permits. These new   Permits have the same expiry date as a Club’s previous Registration Certificate. Club Secretaries must therefore check and make a careful note of the expiry date. For most Clubs the renewal year was 2010, but this will not  necessarily be the case for all Clubs.

Clubs  making application to their Local Authorities before the stated expiry date will automatically qualify for renewal.

Audits

Clubs registered under the Industrial & Provident Societies Act or the Friendly Societies Acts must submit an Annual Return to the Financial Services Authority no later than the date required under
the terms of the Club’s particular Rules. Failure to comply may result in prosecution. Such Clubs
must also ensure the annual fee is paid, the amount of which depends upon the Club’s assets.

Clubs which are incorporated as companies must ensure that their company returns are made to
Companies House by the agreed submission date in order to avoid fines and must also ensure that their Accounts are filed.

Unincorporated Members’ Clubs are not required to submit annual returns or to file Accounts with any outside body.

In addition to the above, please make a note of the date for VAT returns, insurance renewal and the Club’s TV licence.

Fees for a CPC

Rateable Value Band Inital Fee Annual Fee
No rateable value to £4,300 A £100 £70
£4,300 to £33,000 B £190 £180
£33,001 to £87,000 C £315 £295
£87,001 to £125,000 D £450 £320
£125,001 and above E £635 £350