Disposal of Core Property
Section 41J of the Act now includes a definition of "core" property that covers the main premises of a club, and any sporting ground or other facility used by the club in carrying out its objects, as follows:
core property of a registered club means any real property owned or occupied by the club that comprises:
(a) the defined premises of the club, or(b) any facility provided by the club for the use of its members and their guests, or
(c) any other property declared, by a resolution passed by a majority of the members present at a general meeting of the ordinary members of the club, to be core property of the club,
but does not include any property referred to in paragraphs (a)-(c) that is declared, by a resolution passed by a majority of the members present at a general meeting of the ordinary members of the club, not to be core property of the club.
All other club assets will be regarded as "non-core" property, and the disposal of non-core property need not comply with section 41J, but will be subject to disclosure requirements.
To ensure accountability and transparency, clubs will still be required to report to their members which property is being classed as core and non-core. The new measures also provide for members to have their say on what club property is classified as core and non-core by voting on resolutions at a clubÕs general meeting.
Exemptions to the disposal requirements
Clubs will be permitted to dispose of core property without complying with section 41J(3) of the Act if:
- The property is being leased or licensed for a period not exceeding 6 years on terms that have been the subject of a valuation by a registered valuer.
- The property is being disposed of to a wholly owned subsidiary of the club.
- The property is being leased or licensed to a telecommunications provider for the purposes of a telecommunication tower.
- The disposal of the property involves calling for expressions of interest and a subsequent selective tendering process. The disposal and selective tendering process must be approved by a majority vote at a general meeting of the ordinary members of the club.
- The property is being sold by private treaty, but only if it failed to sell at public auction or open tender following compliance with the requirements of section 41J (3) of the Act.
- The terms and nature of the disposal are disclosed to the ordinary members of the club, and the disposal is approved by a majority vote at a general meeting of the ordinary members of the club.
- The Director has approved of the property being disposed of otherwise than in accordance with section 41J (3) of the Act following application by a club.
Leasing or licensing of core property - Section 41J (3) of the Act does not apply in relation to the leasing or licensing of any core property of a registered club if the lease or licence is granted to a person for the purpose of enabling the person to provide goods or services:
- exclusively to members of the club and their guests and to other persons attending the club, or
- to members of the club and their guests and to other members of the public and the granting of the lease or licence for that purpose has been approved at a general meeting of the ordinary members of the club.
Q&As
Q: Does a club still have to seek the approval of its members for the termination of a lease, or for the granting of an easement?A: No. The new section 41J applies more specifically so the approval of members is not required for either the termination of a lease, or for the granting of an easement.
Q: Can any club property be declared as either core or non-core?
A: Yes. While the Act defines certain key items as core property of a club, a resolution at a general meeting of the club that is passed by a majority of the members present at that meeting can redefine those key items as non core property.
Q: Could all club property be declared as being core property? Could all club property be declared as being non-core property?
A: Yes, but only if a majority of club members present at a general meeting of the club support a resolution to either declare all club property as being core property or non core property.
Q: Are there any exemptions to the requirement for disposal of core property?
A: Yes. To provide for greater flexibility there is a list of exemptions to the disposal requirements for core property in clause 47I of the regulation.
Q: If a club wants to grant a lease of more than 10 years in respect of core property and the terms of the lease are supported by a valuation, must the members' approval still be sought?
A: Yes, if a lease is for a period in excess of 10 years, the approval of the majority of members at a general meeting must still be sought.
Q: What happens if a club follows the required procedure for disposal of core property, but the property remains unsold?
A: Under such circumstances the exemptions in clause 471(1)(e)) of the regulation allow a club to sell property by private treaty.
Q: If the circumstances concerning the property or the sale of the property are so unique and/or complex that they are not covered by the exemptions, what steps can a club take?
A: Apart from the exemptions in the regulation, there is provision for a club to apply to the Director of Liquor and Gaming for approval to dispose of core property without complying with section 41J.
Q: Must club members' approval be sought for a lease involving the provision of goods or services directly to club members, for example a golf pro shop at a golf club?
A: No, such leases are exempted by the clause 47I(3) of the regulation.