REPORT TITLE:
Nonprofit Assoc. Act


DESCRIPTION:
Adopts the Uniform Unincorporated Nonprofit Association Act.
Gives entity separate identity from members for purposes of
transfer of real property, liability in contract and tort, and
standing in a claim.  (HB1270 HD1)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        1270
HOUSE OF REPRESENTATIVES                H.B. NO.           H.D. 1
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            
                                                             
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                   A  BILL  FOR  AN  ACT

RELATING TO THE UNIFORM UNINCORPORATED NONPROFIT ASSOCIATION.



BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 1      SECTION 1.  The Hawaii Revised Statutes is amended by adding
 
 2 a new chapter to be appropriately designated and to read as
 
 3 follows:
 
 4                            "CHAPTER  
 
 5         UNIFORM UNINCORPORATED NONPROFIT ASSOCIATION ACT
 
 6      § -1 Definitions.  As used in this chapter:
 
 7      "Member" means a person who, under the rules or practices of
 
 8 a nonprofit association, may participate in the selection of
 
 9 persons authorized to manage the affairs of the nonprofit
 
10 association or in the development of policy of the nonprofit
 
11 association.
 
12      "Nonprofit association" means an unincorporated
 
13 organization, other than one created by a trust, consisting of
 
14 two or more members joined by mutual consent for a common,
 
15 nonprofit purpose.  However, joint tenancy, tenancy in common, or
 
16 tenancy by the entireties does not by itself establish a
 
17 nonprofit association, even if the co-owners share use of the
 
18 property for a nonprofit purpose.
 

 
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 1      "Person" means an individual, corporation, business trust,
 
 2 estate, trust, partnership, association, joint venture,
 
 3 government, governmental subdivision, agency, or instrumentality,
 
 4 or any other legal or commercial entity.
 
 5      "State" means a state of the United States, the District of
 
 6 Columbia, the Commonwealth of Puerto Rico, or any territory or
 
 7 insular possession subject to the jurisdiction of the United
 
 8 States.
 
 9      § -2 Supplementary general principles of law and equity.
 
10 Principles of law and equity supplement this chapter unless
 
11 displaced by a particular provision of it.
 
12      § -3 Territorial application.  Real and personal property
 
13 in this State may be acquired, held, encumbered, and transferred
 
14 by a nonprofit association, whether or not the nonprofit
 
15 association or a member has any other relationship to this State.
 
16      § -4 Real and personal property; nonprofit association as
 
17 legatee, devisee, or beneficiary.(a)  A nonprofit association
 
18 shall be a legal entity separate from its members for the
 
19 purposes of acquiring, holding, encumbering, and transferring
 
20 real and personal property.
 
21      (b)  A nonprofit association in its name may acquire, hold,
 
22 encumber, or transfer an estate or interest in real or personal
 
23 property.
 

 
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 1      (c)  A nonprofit association may be a beneficiary of a trust
 
 2 or contract, a legatee, or a devisee.
 
 3      § -5 Statement of authority as to real property.(a)  A
 
 4 nonprofit association may execute and record a statement of
 
 5 authority to transfer an estate or interest in real property in
 
 6 the name of the nonprofit association.
 
 7      (b)  An estate or interest in real property in the name of a
 
 8 nonprofit association may be transferred by a person so
 
 9 authorized in a statement of authority recorded in the office of
 
10 the registrar of the land court or in the bureau of conveyances,
 
11 whichever is the office in which a transfer of the property would
 
12 be recorded.
 
13      (c)  A statement of authority shall set forth:
 
14      (1)  The name of the nonprofit association;
 
15      (2)  The federal tax identification number, if any, of the
 
16           nonprofit association;
 
17      (3)  The address in this State, including the street
 
18           address, if any, of the nonprofit association, or, if
 
19           the nonprofit association does not have an address in
 
20           this State, its address out of state;
 
21      (4)  That it is an unincorporated nonprofit association; and
 

 
 
 
 
 
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                                     H.B. NO.           H.D. 1
                                                             
                                                        

 
 1      (5)  The name or title of a person authorized to transfer an
 
 2           estate or interest in real property held in the name of
 
 3           the nonprofit association.
 
 4      (d)  A statement of authority shall be executed in the same
 
 5 manner as a deed by a person who is not the person authorized to
 
 6 transfer the estate or interest.
 
 7      (e)  A filing officer may collect a fee for recording a
 
 8 statement of authority in the amount authorized for recording a
 
 9 transfer of real property.
 
10      (f)  An amendment, including a cancellation, of a statement
 
11 of authority shall meet the requirements for execution and
 
12 recording of an original statement.  Unless canceled earlier, a
 
13 recorded statement of authority or its most recent amendment
 
14 shall be canceled by operation of law five years after the date
 
15 of the most recent recording.
 
16      (g)  If the record title to real property is in the name of
 
17 a nonprofit association and the statement of authority is
 
18 recorded in the office in which a transfer of real property would
 
19 be recorded, the authority of the person named in a statement of
 
20 authority shall be conclusive in favor of a person who gives
 
21 value without notice that the person lacks authority.
 
22      § -6  Liability in contract and tort.  (a)  A nonprofit
 
23 association shall be a legal entity separate from its members for
 

 
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                                     H.B. NO.           H.D. 1
                                                             
                                                        

 
 1 the purposes of determining and enforcing rights, duties, and
 
 2 liabilities in contract and tort.
 
 3      (b)  A person shall not be liable for a breach of a
 
 4 nonprofit association's contract merely because the person is a
 
 5 member, is authorized to participate in the management of the
 
 6 affairs of the nonprofit association, or is a person considered
 
 7 to be a member by the nonprofit association.
 
 8      (c)  A person shall not be liable for a tortious act or
 
 9 omission for which a nonprofit association is liable merely
 
10 because the person is a member, is authorized to participate in
 
11 the management of the affairs of the nonprofit association, or is
 
12 a person considered to be a member by the nonprofit association.
 
13      (d)  A tortious act or omission of a member or other person
 
14 for which a nonprofit association is liable shall not be imputed
 
15 to a person merely because the person is a member of the
 
16 nonprofit association, is authorized to participate in the
 
17 management of the affairs of the nonprofit association, or is a
 
18 person considered to be a member by the nonprofit association.
 
19      (e)  A member of, or a person considered to be a member by,
 
20 a nonprofit association may assert a claim against the nonprofit
 
21 association.  A nonprofit association may assert a claim against
 
22 a member or a person considered to be a member by the nonprofit
 
23 association.
 

 
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 1      § -7  Capacity to assert and defend; standing.(a)  A
 
 2 nonprofit association, in its name, may institute, defend,
 
 3 intervene, or participate in a judicial, administrative, or other
 
 4 governmental proceeding or in an arbitration, mediation, or any
 
 5 other form of alternative dispute resolution.
 
 6      (b)  A nonprofit association may assert a claim in its name
 
 7 on behalf of its members if one or more members of the nonprofit
 
 8 association have standing to assert a claim in their own right,
 
 9 the interests the nonprofit association seeks to protect are
 
10 germane to its purposes, and neither the claim asserted nor the
 
11 relief requested requires the participation of a member.
 
12      § -8 Effect of judgment or order.  A judgment or order
 
13 against a nonprofit association shall not by itself be a judgment
 
14 or order against a member or a person authorized to participate
 
15 in the management of the affairs of the nonprofit association.
 
16      § -9 Disposition of personal property of inactive
 
17 nonprofit association.  If a nonprofit association has been
 
18 inactive for three years or longer, or a different period
 
19 specified in a document of the nonprofit association, a person in
 
20 possession or control of personal property of the nonprofit
 
21 association may transfer custody of the property:
 

 
 
 
 
 
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                                     H.B. NO.           H.D. 1
                                                             
                                                        

 
 1      (1)  If a document of the nonprofit association specifies a
 
 2           person to whom transfer is to be made under those
 
 3           circumstances, to that person; or
 
 4      (2)  If no person is so specified, to a nonprofit
 
 5           association or nonprofit corporation pursuing broadly
 
 6           similar purposes or to a government, governmental
 
 7           subdivision, agency, or instrumentality.
 
 8      § -10  Appointment of agent to receive service of process.
 
 9 (a)  A nonprofit association may file in the office of the
 
10 registrar of the land court or in the bureau of conveyances a
 
11 statement appointing an agent authorized to receive service of
 
12 process.
 
13      (b)  A statement appointing an agent shall set forth:
 
14      (1)  The name of the nonprofit association;
 
15      (2)  The federal tax identification number, if any, of the
 
16           nonprofit association;
 
17      (3)  The address in this State, including the street
 
18           address, if any, of the nonprofit association, or, if
 
19           the nonprofit association does not have an address in
 
20           this State, its address out of State; and
 
21      (4)  The name of the person in this State authorized to
 
22           receive service of process and the person's address,
 
23           including the street address, in this State.
 

 
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 1      (c)  A statement appointing an agent shall be signed and
 
 2 acknowledged by a person authorized to manage the affairs of a
 
 3 nonprofit association.  The statement shall also be signed and
 
 4 acknowledged by the person appointed agent, who thereby accepts
 
 5 the appointment.  The appointed agent may resign by filing a
 
 6 resignation in the office of the registrar of the land court or
 
 7 in the bureau of conveyances and giving notice to the nonprofit
 
 8 association.
 
 9      (d)  A filing officer may collect a fee for filing a
 
10 statement appointing an agent to receive service of process, an
 
11 amendment, a cancellation, or a resignation in the amount charged
 
12 for filing similar documents.
 
13      (e)  An amendment to or cancellation of a statement
 
14 appointing an agent to receive service of process shall meet the
 
15 requirements for execution of an original statement.
 
16      § -11  Claim not abated by change.  A claim for relief
 
17 against a nonprofit association shall not abate merely because of
 
18 a change in its members or persons authorized to manage the
 
19 affairs of the nonprofit association.
 
20      § -12  Venue.  For purposes of venue, a nonprofit
 
21 association shall be a resident of the county in which it has an
 
22 office.
 

 
 
 
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 1      § -13 Summons and complaint; service on whom.  In an
 
 2 action or proceeding against a nonprofit association a summons
 
 3 and complaint shall be served on an agent authorized by
 
 4 appointment to receive service of process, an officer, managing
 
 5 or general agent, or a person authorized to participate in the
 
 6 management of its affairs.  If none of them can be served,
 
 7 service may be made on a member.
 
 8      § -14  Short title.  This chapter may be cited as the
 
 9 Uniform Unincorporated Nonprofit Association Act."
 
10      SECTION 2.  If, before the effective date of this Act, an
 
11 estate or interest in real or personal property was by terms of
 
12 the transfer purportedly transferred to a nonprofit association
 
13 but under the law the estate or interest did not vest in the
 
14 nonprofit association, on the effective date of this Act the
 
15 estate or interest vests in the nonprofit association, unless the
 
16 parties had treated the transfer as ineffective.
 
17      SECTION 3.  This Act does not affect an action or proceeding
 
18 commenced or right accrued before this Act takes effect.
 
19      SECTION 4.  This Act shall take effect on July 1, 1999.