October 19

When residents associations have been incorporated, Hampshire entities have provided sufficient financial support to cover the establishment and insurance costs for the in- corporated resident association, plus additional resources to support a range of resi- dent activities. This requirement is designed to ensure that residents and visitors will not seek to sue other individual residents for any injury caused by undertaking an activity organised by that other resident. We believe that it would be detrimental to all concerned if an inju- ry arose and there was no insurance cover available for the protection of the organiser and the injured party. EXAMPLE There are a number of hypothetical examples which could be given to explain our ra- tionale. The most glaring example is the recent request in a number of our villages to offer support for the creation of so-called “Men’s Sheds”. We applaud the desire of village residents to establish an activity where they can spend time together and share their skills and undertake woodworking, metal working and engineering type projects. As the village owner we are generally happy to provide a new facility, for example a shed, and are happy to ensure that the shed is of safe construction. However, the equipment and tools within a Men’s Shed would generally the property of that group. The shed should be open for the use of all residents to use, as a condition of making the premises available, however, the access and activity carried on in that shed are un- der the control of the resident group and not the village operator. If a resident joined the group and accessed the shed but was injured whilst using tools owned by the “Men’s Shed” group and the organisers of that group had failed to en- sure that the tools were safe for use and that the relevant resident was trained on their use, then the organisers of that activity (ie. The Men’s Shed Committee) could individu- ally and collectively be liable to compensate the resident for the injury. In such a cir- cumstance the village operator would not be liable for the injury and none of the af- fected person(s) would have the benefit of the village operators insurance. If the Men’s Shed is part of an incorporated resident’s association and was covered by insurance, then in the circumstances above, the injured party would sue the incorpo- rated resident’s association rather than fellow residents, and in all likelihood would re- ceive compensation from the insurer rather than from fellow residents. If we look at a different scenario involving the same group, we can see the further ben- efit of incorporation. If the Men’s Shed was not incorporated, had no real membership rules and the founders raised funds to purchase equipment and tools and over a period of years, who would own the equipment if the membership significantly increased and the last few of the founders wanted to leave and take the equipment with them which they had purchased? Incorporation avoids that uncertainty, as the incorporated entity would own the property in perpetuity.

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