Entering into contracts

The Incorporated Societies Act 1908 sets out specific requirements for a society entering into a contract:

• If the contract is the type of agreement that, when between individuals, would be in the form of a deed, then the society must have a written contract, executed ‘under seal’ (using the society’s ‘common seal’). An example of this type of contract would be an agreement to buy or sell land.
• If the contract is the type of agreement that, when between individuals, would be in writing, then the society will need a written contract signed by a person authorised by the society to do so (usually an officer). An example of this type of contract would be a loan.
• If the contract is the type of agreement that, when between individuals, would not be in writing, then the society does not need a written contract, (so long as it is entered into by a person authorised by the society to do so, usually an officer).

Societies entering into a contract should consider the following:

• Is the purpose of the contract authorised under the society’s rules and ‘objects’?
• If money is being borrowed, do the society’s rules allow it, and will it be used for a purpose covered by the ‘objects’ of the society?
• Who is authorised to enter into the contract on behalf of the society?

Other guides in

Running your incorporated society

• Your responsibilities as an incorporated society
• Complying with your society's rules
• Holding meetings
• Restrictions on money-making activities
• Records you should keep
• Using our Constitution Builder tool to draft or revise a society’s rules

Other help topics