Re Sick and Funeral Society 1973

• Facts:

◦ The case involved a Sick and Funeral Society, which had two classes of members:

▪ Full members, who paid the full subscription price.

▪ Half members, who paid half the subscription price.

◦ The issue arose upon the dissolution of the society, where it was necessary to determine how the society's property should be distributed among the members.

• Outcome:

◦ Megarry J ruled that the property should be divided in a manner that reflects the difference in subscription levels.

◦ He ordered that full members should receive a share of the property twice as large as that of the half members, considering the differing contributions made by each group in terms of subscription payments.

• Impact and Analysis:

◦ Equitable Distribution Based on Contribution:

▪ The ruling reflected an effort to distribute the society's property in a manner that was proportionate to the members’ financial contributions.

▪ By awarding full members twice the amount of property as half members, Megarry J recognised the differential in membership dues and applied an equitable approach to ensure that members received a share that aligned with what they had contributed to the society.

◦ Clarification of Membership Rights and Obligations:

▪ The case helped clarify how societies with different membership classes should manage property distributions when they dissolve.

▪ It reinforced the notion that, in cases of dissolution, members are entitled to share in the assets of the society based on their financial commitments rather than an equal distribution among all members.

◦ Proportional Distribution in Unincorporated Associations:

▪ This case highlights how unincorporated associations can resolve disputes related to the distribution of assets upon dissolution.

▪ The principle of proportionality in asset division according to the level of contribution is an important aspect of ensuring fairness and upholding the original purpose of the society.

• Key Takeaway:

◦ Re Sick and Funeral Society demonstrates how courts can use proportionality as a guiding principle in the distribution of assets when there are different types of membership with varying financial contributions.

◦ This case highlights the flexibility of courts in tailoring solutions to the specific facts of each case, especially when dealing with unincorporated associations and membership classes.