If you were to approach many Australians and ask what football team they support, chances are not only will you be provided with an answer to the initial question, but they’ll probably wax lyrical about how they came about to support that particular team, and why your choice in football teams is probably wrong, if it’s not the same team. What we’re trying to illustrate is that many Australians love their sport, in particular Australian Rules, either rugby code, soccer, or all of the above. Furthermore, it probably wouldn’t come as a surprise that many of those same fans may be a member of their favourite football teams as well.
The ability for some people to bring up obscure facts and figures in relation to their favourite football team can be astounding. But if the topic of conversation moves to how the Corporations Act 2001 (Cth) (the Act), the common law, and the company constitution may impact on their membership rights, and what influence (if any) their membership has on their favourite football team, will probably draw a blank. However, it is worth taking a general look at what benefits purchasing a membership may afford to footy fans according to the law.
Your favourite football team is a company
Thinking about your favourite football team as a company may not be palatable for some, but the fact of the matter is that the team you support, whether it is in an Australian Football League (AFL) team, or a team from the National Rugby League (NRL), may generally be organised as a company limited by guarantee or shares.
In addition to certain rights found within the provisions of the Act, club members may also have further rights that can be found within the company’s constitution, by-laws and regulations.
What rights do football club members possess?
Generally speaking, members of most football clubs in Australia derive their rights from the Act, the common law, and the company constitution.
Rights provided under the Corporations Act: the Act provides a number of protections to members against conduct that is unfair or oppressive by directors or anyone who owns a stake in the club in relation to commercial activities.
Under the provisions of the Act, members can seek protections against directors or shareholders who hold a controlling stake in the club who undertake some of the following actions:
- withholding information about the company’s affairs;
- allocating share capital with the aim of weakening minority holdings;
- amending the company’s constitution in terms that are unfavourable to the minority;
- conferring benefits on the majority.
Rights provided by common law: common law precedent grants members of football clubs a number of rights exclusive of the Act, such as the right to vote in general meetings, provided the company constitution allows for such a right, the right to inspect a register of members, and the right to be provided with sufficient notice of meetings.
Rights provided by the company constitution: the Act provides that the constitution of the company is a contractual relationship that binds the company, members, directors, secretaries, and fellow members with one another. In the event of a breach, the general remedies available in relation to breach of other contractual relationships may be available to members. Although damages may be excluded. It should however be highlighted, that similar to other contractual relationships, the manner in which the constitution is drafted can also be an important consideration when looking at what rights are provided to members.
The influence of the governing body on football clubs
Beyond the club structure, the governing body, such as the AFL for the purposes of this example, is a company that is limited by guarantee. As a consequence, each club in the competition provides a member representative, and the operations of the competition are governed by a commission.
The clubs grants the AFL the power to manage the competition, and the AFL in return, provides a licence to compete in the competition.
Interestingly, one of the conditions of licensing is the AFL has ultimate discretion to approve any changes in a club’s constitution.
One final thought: Best of luck to your team for the upcoming season!