Do You Know Who Your Members Are?

Published May 3, 2008

During the last several months, the Centre for Sport and Law has been asked by sport organizations to help in the implementation of their discipline and appeal policies, specifically as they relate to member behaviour that is in violation of the organization’s code of conduct or code of ethics. Adding to the challenge and complexity inherent in such an assignment is the reality that more and more individuals are seeking out lawyers to help in the preparation of their defense. Invariably these lawyers have carefully scrutinized the organization’s policies looking for every possible loop-hole that can bolster their client’s case. Often, they are successful in finding it.

Once we are engaged on the file, it is not uncommon for us to find that that the sport organization’s intent was not properly conveyed in the words of their governing documents. Also, their jurisdiction to exercise control over the conduct of members has been poorly defined in that the parameters of membership are fuzzy and it is not clear what policies apply in what situations, and to whom. This feature article will explain the contractual relationship established between sport organizations and their members, and in particular will stress how important it is that membership is defined clearly so that legal jurisdiction is established.

Bear with us through a quick review of administrative law principles 101. The vast majority of Canadian sport organizations are ‘private tribunals’ – that is, they are autonomous, self-governing, private organizations that have the power to write rules, make decisions, and take actions that affect their members and participants. Historically, the courts have been reluctant to interfere in the affairs of private tribunals. The relationship among the members of an association was viewed as personal, particularly where membership was voluntary. In more recent years this has changed, and the courts are prepared to be more hands-on and to review decisions of private tribunals that turn on a question of law, including any question as to the association’s constitution.

In Canada, the 1952 British case Lee v. Showmen’s Guild of Great Britain is viewed as a starting point when considering the legal context for decision-making within sport organizations.  Athletes and others seeking legal remedies for the adverse decisions of their sport organization have, almost without exception, relied on the principles set out in the Lee case. An applicable principle from this case reads as follows:

An association’s governing documents represent a contract among the association’s members, enabling the association and its members to clarify their rights, privileges, and obligations in order to better regulate the association’s affairs.

As private tribunals, sport organizations are self-governing and derive their authority from their constitution, bylaws, policies, procedures and rules.  Taken together, these are the governing documents of the organization and form a contract between the organization and its members.  This contract provides the sport organization with the legal authority to establish the rights, privileges, and obligations of membership.  These governing documents can be amazingly complex and multidimensional – it is also not uncommon for them to be outdated. Governing documents are also widely perceived as being dull yet necessary evils. This is why navigating through the jurisdictional landscape is challenging to the sport administrator.

Jurisdiction refers to a body’s legal authority over a particular matter – in other words, determining what rules apply, or do not apply, in a particular circumstance.  Very often multiple sets of rules may apply and determining which rules will prevail, if any, can be tricky.  For example, sport is organized in a hierarchical fashion from local club to regional league to provincial organization to national organization. Each level has its own rules and regulations but is also subject to many of the rules and regulations of the organization above it in the hierarchy.

When an individual joins a sport organization, he or she accepts the inherent authority of the sport organization and the terms of the contract expressed in the organizations’ governing documents.  In most cases, athletes, coaches and officials are members of their respective sport organizations and thus are parties to a contractual relationship with the sport organization.  This contract works to the benefit of both parties by establishing and clarifying their respective rights and obligations.  Occasionally, however, the contract may work to the detriment of the parties if the policies that make up the contract are poorly designed, vague, contradictory, or ill-suited to be the organization’s needs, resources or realities.

A sport organization’s governing documents are critical as they provide the foundation of the organization’s structure, jurisdiction and authority and contain all the rules by which the organization and its members govern themselves.  Typically, sport organizations pay too little attention to their governing documents and realize their importance only when the deficiencies in these documents land them squarely in the middle of a dispute with a member.  Quoting from one of our publications in the risk management handbook series, “for many sport organizations, it is a sobering lesson to learn that policy is what’s written on the paper and not what’s in the mind of the drafters of the policy, or in the organization’s collective memory”.

The bylaws are the most important of the governing documents as they provide the organization with the legal authority to enforce rights and obligations of membership.  A common weakness in bylaws is defining clearly who is a member.  Are members individuals, teams, leagues, clubs, other entities? Some NSOs have as few as ten to 14 members, being the provinces and territories of Canada. In these situations, the NSO has no jurisdiction over a club or an individual. Other NSOs have sport clubs as members, but have no member link to a PSO/TSO or to an individual such as an athlete, coach or official.

In these situations, jurisdiction over members is similarly constrained. Very few youth sport organizations have parents as members, although parents are usually the source of the organization’s problems and jurisdiction over parents would be a desirable thing. The lesson from this mish-mash -- every sport organization should consider who it wants within its jurisdiction, and from that point, should then define the categories of members in the bylaws.

A sport organization should also have control over admission to membership. It should not be automatic upon payment of membership dues – otherwise, an organization is compelled to accept anyone as a member, including individuals who may have been a problem in the past or have the potential to harm the organization in the future.  As a private entity, a sport organization has the power to limit or restrict membership by establishing a minimum membership qualification, provided these qualifications are not discriminatory under human rights legislation and are consistently enforced.  Suggested wording is as follows:

Admission of Members - No individual or entity will be admitted as a Member of the Association unless:

• The candidate member has made an application for membership in a manner prescribed by the Association;
• The candidate member has been approved by majority vote as a member by the Board or by any committee or individual delegated this authority by the Board;
• If, at the time of applying for membership the candidate member is currently a Member, the candidate member is a Member in good standing;
• If the candidate member was at any time previously a Member, the candidate member was a Member in good standing at the time of ceasing to be a Member; and
• The candidate member has paid dues as prescribed by the Board.

This clause would need to be interpreted in conjunction with a section of the bylaws describing the qualifications of membership.  Depending on the nature of the organization, a clause describing qualifications may need to be worded very carefully.  For example, a provincial sport organization may wish to govern both its member clubs and those individuals associated with member clubs, but may fail to include a section of membership for the individuals.  Suggested wording to include clubs and its members is as follows:

• Club Member – A sport club that has bylaws and policies that are consistent with those of the Association.
• Individual Member – Any individual who is a registered with a Club Member.

Another consideration on membership is its duration. Once a member, always a member? Or does membership begin and end? There are advantages to having membership issued on an annual basis and then lapse, thus requiring a reapplication for membership each year. Otherwise, an organization may be stuck with a member that it does not want. The legal advantages of this structure may outweigh the administrative inconveniences. This was made painfully clear to Judo Ontario in the case of Canadian Universities Reciprocal Insurance Exchange (CURIE) v. CGU Insurance Company of Canada (2007), where the court ruled that a former member club, that had not renewed membership or paid dues, was a member for the purposes of insurance coverage.

A perennial weakness that we have observed in governing documents is inadequate definitions of “good standing”. Common bylaw templates state only that a member ceases to be in good standing when they cease to pay their dues. This is woefully inadequate in the sport setting. Bylaws should state clearly what members must do, or not do, to remain members in good standing, including what sort of membership status they should maintain with other entities in the sport spectrum. Here is an example:

A Member will be deemed to be in good standing provided that the Member:

• Owes no outstanding membership dues or other debts to the Association;
• Has not ceased to be a Member;
• Has not been suspended or expelled from membership;
• Has complied with the Bylaws, policies and rules of the Association;
• Is not subject to a disciplinary action or investigation of the Association, or if subject to disciplinary action or investigation of Association previously, has fulfilled all terms and conditions of such disciplinary action to the satisfaction of Association;
• If a Club Member, is a member in good standing of a Provincial/Territorial Association; and
• If an Individual Member, is a member in good standing of his or her respective Club Member.

Members who cease to be in good standing will not be entitled to the benefits and privileges of membership, including the right to vote of meetings of Members. A Member may be restored to good standing upon meeting the definition of good standing set out in this Bylaw, to the satisfaction of the Board.

Lastly, several sport organizations have agreements or affiliations with other entities that may govern coaches or officials within the sport organization.  Do the sport organization’s governing documents reflect that governance, jurisdiction and/or implementation of sanctions will be carried out by the other entities, and that the two entities will mutually respect and honour such sanctions? As indicated above, multiple sets of rules may apply and they may be tricky to enforce. It is important to have the appropriate contracts and governing documents that are linked together properly and that reflect the intent of both organizations.

An essential element of risk management is being prepared to handle unexpected situations as they arise. Every sport organization should pay attention to the fine print of their governing documents, now, before they are put in the middle of litigation with the lawyer on the other side looking for (and invariably finding) a loop-hole. Please take the time to review your governing documents with a careful eye to the issue of jurisdiction over membership: who is a member, how do they become a member, can you deny a member, can you remove a member, what is the duration of membership, what do members need to do to be in good standing, etc. Some homework now has the potential to save you a lot of grief later.

Originally published: Centre for Sport and Law Newsletter (2008) Vol. 4(2)