Chapter 1745 | Uniform Unincorporated Nonprofit Association Act

Section 1745.05 | Definitions.

• Effective: October 24, 2024
• Latest Legislation: House Bill 301 - 135th General Assembly

As used in this chapter, unless the context otherwise requires:

(A) "Authorized communications equipment" means any communications equipment that provides a transmission, including, but not limited to, by telephone, telecopy, or any electronic means, from which it can be determined that the transmission was authorized by, and accurately reflects the intention of, the member or manager involved and, with respect to meetings, allows all persons participating in the meeting to contemporaneously communicate with each other.

(B)(1) "Entity" means any of the following:

(a) An unincorporated nonprofit association existing under the laws of this state or any other state;

(b) A nonprofit corporation existing under the laws of this state or any other state;

(c) A for profit corporation existing under the laws of this state or any other state;

(d) Any of the following organizations existing under the laws of this state, the United States, or any other state:

(i) An unincorporated business or for profit organization, including a general or limited partnership;

(ii) A limited liability company;

(iii) Any other legal or commercial entity the formation and operation of which is governed by statute.

(2) "Entity" includes a domestic or foreign entity.

(C) "Established practices" means the practices used by an unincorporated nonprofit association without material change during the most recent five years of its existence or, if it has existed for less than five years, during its entire existence.

(D) "Governing principles" means all agreements, whether oral, in a record, or implied from its established practices, or any combination of them, that govern the purpose or operation of an unincorporated nonprofit association and the rights and obligations of its members and managers. "Governing principles" includes any amendment or restatement of the agreements constituting the governing principles.

(E) "Internal Revenue Code" means the "Internal Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C. 1, as amended.

(F) "Manager" means a person, irrespective of the person's designation as director or other designation, that is responsible, alone or in concert with others, for the management of an unincorporated nonprofit association as stated in division (E) of section 1745.32 of the Revised Code.

(G) "Member" means a person that, under the governing principles of an unincorporated nonprofit association, is entitled to participate in the selection of persons authorized to manage the affairs of the association or in the adoption of the policies and activities of the association.

(H) "Mutual benefit association" means any unincorporated nonprofit association organized under this chapter other than a public benefit association.

(I) "Person" means an individual, corporation, business trust, statutory entity trust, estate, trust, partnership, limited liability company, cooperative, association, joint venture, public corporation, government or governmental subdivision, agency, or instrumentality, two or more persons having a joint or common interest, or any other legal or commercial entity.

(J) "Public benefit association" means an unincorporated nonprofit association that is exempt from federal income taxation under section 501(c)(3) of the Internal Revenue Code or is organized for a public or charitable purpose and that upon dissolution must distribute its assets to a public benefit association, the United States, a state or any political subdivision of a state, or a person that is recognized as exempt from federal income taxation under section 501(c)(3) of the Internal Revenue Code.

(K) "Public benefit entity" means an entity that is recognized as exempt from federal income taxation under section 501(c)(3) of the Internal Revenue Code or is organized for a public or charitable purpose and that upon dissolution must distribute its assets to a public benefit entity, the United States, a state or any political subdivision of a state, or a person that is recognized as exempt from federal income taxation under section 501(c)(3) of the Internal Revenue Code. "Public benefit entity" does not include an entity that is organized by one or more municipal corporations to further a public purpose that is not a charitable purpose.

(L) "Record" means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.

(M) "Unincorporated nonprofit association" means an unincorporated organization, consisting of two or more members joined by mutual consent pursuant to an agreement, written, oral, or inferred from conduct, for one or more common, nonprofit purposes. "Unincorporated nonprofit association" does not include any of the following:

(1) A trust;

(2) A marriage, domestic partnership, common law relationship, or other domestic living arrangement;

(3) An organization that is formed under any other statute that governs the organization and operation of unincorporated associations;

(4) A joint tenancy, tenancy in common, or tenancy by the entireties notwithstanding that the co-owners share use of the property for a nonprofit purpose;

(5) A religious organization that operates according to the rules, regulations, canons, discipline, or customs established by the organization, including any ministry, apostolate, committee, or group within that organization, unless the governing principles of such organization specifically provide that division (M)(5) of this section does not apply to such organization.

(N)(1) Subject to division (N)(2) of this section, "volunteer" means a manager, officer, member, or agent of an unincorporated nonprofit association, or another person acting for the association, who satisfies both of the following:

(a) Performs services for or on behalf of, and under the authority or auspices of, that unincorporated nonprofit association;

(b) Does not receive compensation, either directly or indirectly, for performing those services.

(2) For purposes of division (N)(1) of this section, "compensation" does not include any of the following:

(a) Actual and necessary expenses that are incurred by a volunteer in connection with the services performed for an unincorporated nonprofit association and that are reimbursed to the volunteer or otherwise paid;

(b) Insurance premiums paid on behalf of a volunteer, and amounts paid or reimbursed, pursuant to divisions (A) and (G) of section 1745.43 of the Revised Code;

(c) Modest perquisites.

Last updated August 28, 2024 at 1:41 PM

Section 1745.06 | Relation to other law.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) Principles of law and equity supplement this chapter unless displaced by a particular provision of this chapter.

(B) A statute in this state governing a particular type of unincorporated nonprofit association prevails over an inconsistent provision in this chapter to the extent of the inconsistency.

(C) This chapter supplements all regulatory laws that are applicable to nonprofit organizations operating in this state. In the event of a conflict, those regulatory laws prevail.

Section 1745.07 | Governing law; territorial application.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) Except as otherwise provided in division (B) of this section, the law of this state governs all unincorporated nonprofit associations formed or operating in this state.

(B) Unless the governing principles of an unincorporated nonprofit association specify a different jurisdiction, the law of the jurisdiction in which the association has its main place of activities governs the internal affairs of the association.

Section 1745.08 | Legal entity; perpetual existence; powers.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

All of the following apply to an unincorporated nonprofit association:

(A) It is a legal entity distinct from its members and managers.

(B) It has perpetual duration unless its governing principles specify otherwise.

(C) It has the same powers as an individual to do all things necessary or convenient to carry on its activities.

(D) It may engage in profit-making activities, but any profits from those activities shall be used or set aside for the association's nonprofit purposes.

Section 1745.09 | Ownership and transfer of property.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

An unincorporated nonprofit association may acquire, hold, encumber, or transfer in its name an estate or interest in real or personal property. An unincorporated nonprofit association may be a legatee, a devisee, or a beneficiary of a trust or contract. All property acquired by an unincorporated nonprofit association by purchase, gift, devise, bequest, or otherwise shall be the absolute property of the association, unless it is otherwise specified in writing at the time of acquiring that property.

Section 1745.10 | Liabilities.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

A debt, obligation, or other liability of an unincorporated nonprofit association, whether arising in contract, tort, or otherwise, is solely the debt, obligation, or other liability of the association and does not become the debt, obligation, or other liability of a member or manager solely because the member acts as a member or the manager acts as a manager. A person's status as a member or a manager of an unincorporated nonprofit association does not prevent or restrict any law other than this chapter from imposing liability on the person or association because of the person's conduct.

Section 1745.11 | Assertion and defense of claims.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

An unincorporated nonprofit association has the capacity to sue and be sued in its own name. A member or a manager of an unincorporated nonprofit association may assert a claim that the member or manager has against the association. An unincorporated nonprofit association may assert a claim that it has against a member or a manager of the association.

Section 1745.12 | Assets subject to judgment, execution and other process.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

All assets, property, funds, and rights or interests, at law or in equity, of any unincorporated nonprofit association shall be subject to judgment, execution, and other process. A money judgment against an unincorporated nonprofit association shall be enforced only against the association as an entity and shall not be enforceable against the property of any manager or member of the association.

Section 1745.13 | Appointment of agent to receive service of process.

• Effective: May 20, 2014
• Latest Legislation: Senate Bill 98 - 130th General Assembly

(A) An unincorporated nonprofit association may file in the office of the secretary of state a statement appointing an agent authorized to receive service of process. The agent shall be one of the following:

(1) A natural person who is a resident of this state;

(2) A domestic or foreign corporation, nonprofit corporation, limited liability company, partnership, limited partnership, limited liability partnership, limited partnership association, professional association, business trust, or unincorporated nonprofit association that has a business address in this state. If the agent is an entity other than a domestic corporation, the agent shall meet the requirements of Title XVII of the Revised Code for an entity of the agent's type to transact business or exercise privileges in this state.

The statement appointing an agent shall set forth the name of the unincorporated nonprofit association and the name and address in this state of the agent, including the street and number or other particular description, and shall otherwise be in the form that the secretary of state prescribes. The secretary of state shall keep a record of the names of all unincorporated nonprofit associations that have filed a statement appointing an agent authorized to receive service of process and the names and addresses of their respective agents.

(B) A statement appointing an agent authorized to receive service of process under division (A) of this section shall be signed by a person authorized to manage the affairs of the unincorporated nonprofit association. The statement also shall be signed by the person appointed as agent who accepts the appointment. The appointed agent may resign by filing with the secretary of state, on a form prescribed by the secretary of state, a written notice to that effect that is signed by the agent and by sending a copy of the notice to the association at the current or last known address of its principal office on or prior to the date that the notice is filed with the secretary of state. Upon the expiration of thirty days after the filing, the authority of the agent shall terminate.

(C) An unincorporated nonprofit association may revoke the appointment of an agent by filing with the secretary of state on a form prescribed by the secretary of state a written appointment of another agent and a statement that the appointment of the former agent is revoked.

Section 1745.14 | Service of process.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

In an action or proceeding against an unincorporated nonprofit association, a summons and complaint or other process may be served on an agent authorized by appointment to receive service of process or a manager of the association or in any other manner authorized by the law of this state.

Section 1745.15 | Action or proceeding not abated by change.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

An action or proceeding against an unincorporated nonprofit association does not abate merely because of a change in its members or managers.

Section 1745.16 | Venue.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

Unless otherwise provided by law, the venue of an action against an unincorporated nonprofit association brought in this state shall be determined under the statutes applicable to an action brought in this state against a nonprofit corporation.

Section 1745.17 | Member not an agent.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

A member of an unincorporated nonprofit association is not an agent of the association solely by reason of being a member.

Section 1745.18 | Approval by members.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

Except as otherwise provided in its governing principles, an unincorporated nonprofit association shall have the approval of its members to do any of the following:

(A) Admit, suspend, dismiss, or expel a member;

(B) Select or dismiss a manager;

(C) Adopt, amend, or repeal its governing principles;

(D) Sell, lease, exchange, or otherwise dispose of all or substantially all of the association's property, with or without the association's goodwill, outside the ordinary course of its activities;

(E) Dissolve under section 1745.50 of the Revised Code or merge or consolidate under section 1745.46 or 1745.461 of the Revised Code;

(F) Undertake any other act outside the ordinary course of the association's activities if the association has annual gross receipts of less than twenty-five thousand dollars;

(G) Determine the purposes of the association and, if the association has annual gross receipts of less than twenty-five thousand dollars, determine the policies of the association;

(H) Do any other act or exercise any right that requires action by the members under the governing principles.

Section 1745.19 | Notice requirements.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) Unless another form of notice is required by the governing principles of an unincorporated nonprofit association or by applicable law, any notice required by this chapter shall be in writing and shall be delivered personally or sent by telegram, by the use of authorized communications equipment, or by United States mail, express mail, or courier service, with postage or fees prepaid.

(B) In computing the period of time for the giving of a notice required or permitted under this chapter or under the governing principles of an unincorporated nonprofit association or a resolution of its members or managers, the day on which the notice is given shall be excluded, and the day when the act for which the notice is given is to be done shall be included, unless the instrument calling for the notice provides otherwise. If notice is given by personal delivery or transmitted by telegram or by the use of authorized communications equipment, the notice shall be considered to have been given when it is delivered or transmitted. If notice is sent by United States mail, express mail, or courier service, the notice shall be considered to have been given when it is deposited in the mail or with the courier service.

(C) A written notice or report delivered as part of a newsletter, magazine, or other publication regularly sent to members shall constitute a written notice or report if addressed or delivered to the member's address shown in the unincorporated nonprofit association's current list of members, or, in the case of members who are residents of the same household and who have the same address in the association's current list of members, if addressed or delivered to one of those members at the address appearing on the association's current list of members.

Section 1745.20 | Membership.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) An unincorporated nonprofit association shall maintain a record of its members containing the name and address of each member and, if members are classified, the class to which the member belongs.

(B) A member of an unincorporated nonprofit association may be suspended, dismissed, or expelled as provided in division (A) of section 1745.29 of the Revised Code or may resign as provided in division (A) of section 1745.30 of the Revised Code. Upon the suspension or termination of membership, that fact and the date of the suspension or termination shall be recorded in the association's membership records.

(C) Unless the governing principles provide otherwise, all rights and privileges of a member in an unincorporated nonprofit association and its property shall cease on termination of membership.

(D) Whenever the number of members of an unincorporated nonprofit association that, under the law or its governing principles, must have a specified number of members is reduced below the specified number, the unincorporated nonprofit association shall not be required because of that reduction to cease carrying on its activities, but the continuing members may fill all vacancies.

(E) Unless otherwise provided in the governing principles of an unincorporated nonprofit association, all members have the same membership rights and privileges.

(F) All members of an unincorporated nonprofit association shall exercise their membership rights and privileges consistent with the obligation of good faith and fair dealing.

Section 1745.21 | Meetings of voting members; calling and place of meeting.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) Unless the governing principles provide otherwise, meetings of voting members of an unincorporated nonprofit association may be called by any of the following:

(1) The president or, in case of the president's absence, death, or disability, the vice-president authorized to exercise the authority of the president;

(2) The manager or managers by action at a meeting, or a majority of the managers acting without a meeting;

(3) The lesser of ten per cent of the voting members or twenty-five of the voting members, unless the governing principles specify for that purpose a smaller or larger proportion or number, but not in excess of fifty per cent of the voting members;

(4) Any other officers or persons that the governing principles authorize to call those meetings.

(B) If so provided in the governing principles, meetings of voting members may be held either within or outside this state or solely by means of authorized communications equipment.

(C) Unless the governing principles provide otherwise, the voting members and proxyholders who are not physically present at a meeting of voting members may attend the meeting by the use of authorized communications equipment that enables the voting members and proxyholders an opportunity to participate in the meeting and to vote on matters submitted to the voting members, including an opportunity to read or hear the proceedings of the meeting, participate in the proceedings, and contemporaneously communicate with the persons who are physically present at the meeting. Any voting member who uses authorized communications equipment under this division is considered to be present in person at the meeting whether the meeting is held at a designated place or solely by means of authorized communications equipment. The members or managers may adopt procedures and guidelines for the use of authorized communications equipment in connection with a meeting of voting members to permit the unincorporated nonprofit association to verify that a person is a voting member or proxyholder and to maintain a record of any vote or other action taken at the meeting.

Section 1745.22 | Notice of meeting.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

Unless the governing principles provide for notice of meetings otherwise than as provided in this section, written notice stating the place, if any, and the time of a meeting, the means, if any, by which the voting members can be present and vote at the meeting through the use of authorized communications equipment, and in case of a special meeting the purpose or purposes for which the meeting is called, shall be given in the manner described in section 1745.19 of the Revised Code, to each member entitled to notice of the meeting not less than ten and not more than sixty days before the date of the meeting. The notice of the meeting shall be given by or at the direction of the president, the secretary, or any other person required or permitted by the governing principles to give notice or by the officers or persons calling the meeting. If mailed or sent by overnight delivery service, that notice shall be addressed to the member at the member's address as it appears on the records of the unincorporated nonprofit association. If sent by means of authorized communications equipment, that notice shall be sent to the address furnished by the voting member for transmissions by authorized communications equipment. Notice of adjournment of a meeting need not be given if the place, if any, and the time to which it is adjourned and the procedure by which the voting members can be present and vote at the adjourned meeting through the use of authorized communications equipment are fixed and announced at the meeting.

Section 1745.23 | Waiver of notice.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) Notice of the place, if any, the time, and the purpose or purposes of any meeting of voting members or managers, as the case may be, whether required by law or the governing principles may be waived in writing, either before or after the holding of that meeting, by any member or any manager. That writing shall be filed with or entered upon the records of the meeting. A transmission by authorized communications equipment that contains a waiver is a writing for purposes of this division.

(B) If a member or manager attends a meeting described in division (A) of this section without protesting prior to or at the commencement of the meeting, then the lack of proper notice shall be considered to be a waiver by the member or manager of notice of the meeting.

(C) Unless the governing principles provide otherwise, a member shall be considered in attendance at a meeting described in division (A) of this section if the member is present in person, by the use of authorized communications equipment, by mail, or, if permitted, by proxy. Unless the governing principles provide otherwise, a manager shall be considered in attendance at a meeting described in division (A) of this section if the manager is present in person or by the use of authorized communications equipment.

Section 1745.24 | Quorum for voting members' meeting.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

Unless the governing principles provide otherwise, the following apply:

(A) The voting members present in person, by the use of authorized communications equipment, by mail, or, if permitted, by proxy at any meeting of voting members shall constitute a quorum for the meeting.

(B) The affirmative vote of a majority of the voting members present at a meeting at which a quorum is present as provided in division (A) of this section shall be necessary for the authorization or taking of any action voted upon by the members, except that no action required by law or by the governing principles to be authorized or taken by a specified proportion or number of the voting members or of any class of voting members may be authorized or taken by a lesser proportion or number.

Section 1745.25 | Voting.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) Except as otherwise provided in the governing principles, each member, regardless of class, shall be entitled to one vote on each matter properly submitted to the members for their vote, consent, waiver, release, or other action.

(B) Unless the governing principles provide otherwise, voting at elections and votes on other matters may be conducted by mail or by the use of authorized communications equipment.

(C) Participation by a member in a meeting through the use of any of the means of communication described in division (B) of this section constitutes presence in person of that member at the meeting. The members or managers may adopt procedures and guidelines for the use of authorized communications equipment to permit the unincorporated nonprofit association to verify that a person is a voting member and to maintain a record of any vote.

(D) Unless the governing principles provide otherwise, no member who is a natural person shall vote or act by proxy.

Section 1745.26 | Special voting requirements for members or managers.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

Whenever with respect to the authorization or taking of any action by the members or the managers the governing principles require the vote, consent, waiver, or release of a greater proportion or number of the members or the managers than that otherwise required by law with respect to that authorization or taking of the action, the provisions of the governing principles shall control.

Section 1745.27 | Vote of members required for rescission or revocation.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

The authorization or taking of any action by vote, consent, waiver, or release of the members may be rescinded or revoked by the same vote, consent, waiver, or release as at the time of rescission or revocation would be required to authorize or take that action in the first instance, subject to the contract rights of other persons.

Section 1745.28 | Action without a meeting.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) Unless the governing principles prohibit the authorization or taking of any action of the members or the managers without a meeting, any action that may be authorized or taken at a meeting of the members or the managers, as the case may be, may be authorized or taken without a meeting with the affirmative vote or approval of, and in a writing or writings signed by, all of the members or all of the managers, as the case may be, who would be entitled to notice of a meeting for that purpose, or, in the case of members, any other proportion or number of voting members, not less than a majority, that the governing principles permit. The writing or writings described in this division shall be filed with or entered upon the records of the unincorporated nonprofit association. Any certificate with respect to the authorization or taking of any action described in this division that is required to be filed in the office of the secretary of state shall recite that the authorization or taking of that action was in a writing or writings approved and signed as specified in this section.

(B) Any transmission by authorized communications equipment that contains an affirmative vote or approval of the person described in division (A) of this section is a signed writing for purposes of this section. The date on which that transmission by authorized communications equipment is sent is the date on which the writing is signed.

Section 1745.29 | Admission, suspension, dismissal, or expulsion of members.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) A person becomes a member of an unincorporated nonprofit association and may be suspended, dismissed, or expelled in accordance with the association's governing principles. If there are no applicable governing principles, a person may become a member or be suspended, dismissed, or expelled from an unincorporated nonprofit association by a vote of its members. A person may not be admitted as a member of an unincorporated nonprofit association without the person's consent.

(B) Unless the governing principles provide otherwise, the suspension, dismissal, or expulsion of a member of an unincorporated nonprofit association does not relieve the member from any unpaid capital contribution, dues, assessments, fees, or other obligation incurred or commitment made by the member before the suspension, dismissal, or expulsion.

Section 1745.30 | Member's resignation.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) A member may resign from membership in an unincorporated nonprofit association in accordance with the governing principles. In the absence of applicable governing principles, a member may resign at any time.

(B) Unless the governing principles provide otherwise, resignation of a member of an unincorporated nonprofit association does not relieve the member from any unpaid capital contribution, dues, assessments, fees, or other obligation incurred or commitment made by the member before the resignation.

Section 1745.31 | Membership interest not transferable.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

Except as otherwise provided in the governing principles, any interest or right of the member under the governing principles is not transferable.

Section 1745.32 | Selection of managers; management rights of managers.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

Except as otherwise provided in this chapter or the governing principles, all of the following apply:

(A) The members of an unincorporated nonprofit association may select the manager or managers.

(B) A manager may be a member of the association.

(C) If no manager is selected, all members are managers.

(D) Each manager has equal rights in the management and conduct of the association's activities.

(E) All matters relating to the association's activities are decided by its managers, except for those matters reserved for approval by members as specified in section 1745.18 of the Revised Code.

(F) A difference among managers is decided by a majority of the managers.

Section 1745.33 | Authority and duties of manager; standard of care.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) Except when the law or the governing principles require that action be otherwise authorized or taken, all of the authority of an unincorporated nonprofit association shall be exercised by or under the direction of its manager or managers.

(B) The only fiduciary duties a manager owes to the association are the duties set forth in this division. The duties of a manager are to act in good faith, in a manner the manager reasonably believes to be in or not opposed to the best interests of the unincorporated nonprofit association, and with the care that an ordinarily prudent person in a similar position would use under similar circumstances. A manager serving on a committee of managers is acting as a manager.

(C) In performing the duties of a manager, a manager is entitled to rely on information, opinions, reports, or statements, including financial statements and other financial data, that are prepared or presented by any of the following:

(1) One or more managers, officers, or employees of the association who the manager reasonably believes are reliable and competent in the matters prepared or presented;

(2) Counsel, public accountants, or other persons as to matters that the manager reasonably believes are within the person's professional or expert competence;

(3) A committee of the managers in which the manager does not serve, duly established in accordance with a provision of the governing principles as to matters within its designated authority, which committee the manager reasonably believes to merit confidence.

(D) For purposes of division (B) of this section, the following apply:

(1) A manager shall not be found to have failed to perform the manager's duties in accordance with that division, unless it is proved by clear and convincing evidence in an action brought against the manager that the manager has not acted in good faith, in a manner the manager reasonably believes to be in or not opposed to the best interests of the unincorporated nonprofit association, or with the care that an ordinarily prudent person in a similar position would use under similar circumstances. An action under division (D)(1) of this section includes, but is not limited to, an action that involves or affects any of the following:

(a) A change or potential change in control of the association;

(b) A termination or potential termination of the manager's service to the association as manager;

(c) The manager's service in any other position or relationship with the association.

(2) A manager shall not be considered to be acting in good faith if the manager has knowledge concerning the matter in question that would cause reliance on information, opinions, reports, or statements that are prepared or presented by any of the persons described in divisions (C)(1) to (3) of this section, to be unwarranted.

(3) The provisions of division (D) of this section do not limit relief available under section 1745.42 of the Revised Code.

(E)(1) Subject to divisions (E)(2) and (3) of this section, a manager is liable in damages for any act that the manager takes or fails to take as manager only if it is proved, by clear and convincing evidence, in a court with jurisdiction that the act or omission of the manager was one undertaken with a deliberate intent to cause injury to the association or was one undertaken with a reckless disregard for the best interests of the association.

(2) Division (E)(1) of this section does not affect the liability of a manager under section 1745.56 of the Revised Code.

(3) Subject to division (E)(2) of this section, division (E)(1) of this section does not apply if, and only to the extent that, at the time of an act or omission of a manager that is the subject of the complaint, the governing principles of the association state by specific reference to division (E)(1) of this section that its provisions do not apply to the association.

(F) For purposes of this section, in determining what a manager reasonably believes to be in or not opposed to the best interests of the association, a manager shall consider the purposes of the association and may consider any of the following:

(1) The interests of the employees, suppliers, creditors, and customers of the association;

(2) The economy of this state and of the nation;

(3) Community and societal considerations;

(4) The long-term and short-term best interests of the association, including, but not limited to, the possibility that those interests may be best served by the continued independence of the association.

(G) Divisions (E) and (F) of this section do not affect the duties of a manager who acts in any capacity other than in the capacity as a manager.

Section 1745.34 | Meetings of managers; notice.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

Unless otherwise provided in the governing principles, the following apply:

(A) Meetings of the managers may be called by any two managers or by any chairperson, president, or vice-president of the unincorporated nonprofit association.

(B) Meetings of the managers may be held at any place within or outside this state, including by means of authorized communications equipment, unless the governing principles prohibit participation by managers at a meeting by means of authorized communications equipment. Participation at a meeting pursuant to this division constitutes presence at that meeting.

(C) Notice of the place, if any, and time of each meeting of the managers shall be given to each manager either by personal delivery or by mail, by overnight delivery service, or by means of authorized communications equipment at least two days before the meeting. The notice need not specify the purposes of the meeting.

(D) Notice of adjournment of a meeting of the managers need not be given if the time and place to which it is adjourned are fixed and announced at that meeting.

Section 1745.35 | Quorum for managers' meeting.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

Unless the governing principles provide otherwise, a majority of the whole authorized number of managers is necessary to constitute a quorum for a meeting of the managers, except that a majority of the managers in office constitutes a quorum for filling a vacancy in the position of manager. The act of a majority of the managers present at a meeting at which a quorum is present is the act of all of the managers, unless the act of a greater number is required by the governing principles.

Section 1745.36 | Executive and other committees of managers.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) The governing principles may provide for the creation by the managers of an executive committee or any other committee of the managers, to consist of one or more managers, and may authorize the delegation to that committee of any of the authority of the managers, however conferred.

(B) The managers may appoint one or more managers as alternate members of any committee described in division (A) of this section, who may take the place of any absent member or members at any meeting of the particular committee.

(C) Each committee described in division (A) of this section shall serve at the pleasure of the managers, shall act only in the intervals between meetings of the managers, and shall be subject to the control and direction of the managers.

(D) Unless otherwise provided in the governing principles or ordered by the managers, any committee described in division (A) of this section may act by a majority of its members at a meeting or by a writing or writings signed by all of its members.

(E) Meetings of committees described in division (A) of this section may be held by any means of authorized communication equipment, unless participation by members of the committee at a meeting by means of authorized communications equipment is prohibited by the governing principles or any order of the managers. Participation at a meeting pursuant to this division constitutes presence at the meeting.

(F) An act or authorization of an act by any committee described in division (A) of this section within the authority delegated to it shall be as effective for all purposes as the act or authorization of the managers.

Section 1745.37 | Officers; authority and removal.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) The officers of an unincorporated nonprofit association, if any, may consist of a president, a secretary, a treasurer, and, if desired, a chairperson, one or more vice-presidents, and any other officers and assistant officers that may be considered necessary, each of whom may be designated by any other titles that may be provided in the governing principles or the resolutions of the managers. Unless the governing principles provide otherwise, none of the officers need be a manager. Any two or more offices may be held by the same person. The officers shall be elected or appointed at the time, in the manner, and for the terms that may be prescribed in the governing principles. In the absence of any such provision, all officers shall be elected annually by the managers.

(B) Unless the governing principles provide otherwise, the following apply:

(1) All officers, as between themselves and the association, shall respectively have the authority and perform the duties that are determined by the persons authorized to elect or appoint them.

(2) Any officer may be removed, with or without cause, by the persons authorized to elect or appoint the officer without prejudice to the contract rights of that officer. The election or appointment of an officer for a given term, or a general provision in the governing principles with respect to term of office, shall not be considered to create contract rights.

(3) The persons authorized to elect or appoint officers may fill any vacancy in any office occurring for whatever reason.

Section 1745.38 | Association mortgages.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

The managers of an unincorporated nonprofit association may authorize any mortgage, pledge, or deed of trust of all or any of the property of the association of any description or any interest in the property, for the purpose of securing the payment or performance of any obligation or contract. Unless the governing principles or the terms of any trust on which the association holds any particular property provide otherwise, no vote or consent of the members of the association or authorization from the court under section 1715.39 of the Revised Code is necessary for that action.

Section 1745.39 | Right of a member or manager to information.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) On reasonable notice, a member or manager of an unincorporated nonprofit association may inspect and copy during the association's regular operating hours and at a reasonable location specified by the association any record maintained by the association regarding its activities, financial condition, and other circumstances, to the extent the information is material to the member's or manager's rights and duties under the association's governing principles or this chapter.

(B) An unincorporated nonprofit association may impose reasonable restrictions on access to and use of information to be furnished under this section, including designating the information confidential and imposing nondisclosure and safeguarding obligations on the recipient.

(C) An unincorporated nonprofit association may charge a person that makes a demand under this section reasonable copying costs, limited to the costs of labor and materials.

(D) A former member or manager of an unincorporated nonprofit association may have access to information to which the member or manager was entitled while a member or manager of the association if the information pertains to the period during which the person was a member or manager, the former member or manager seeks the information in good faith, and the former member or manager satisfies divisions (A) to (C) of this section.

Section 1745.40 | Distributions prohibited; compensation and other permitted payments.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) Except as otherwise provided in division (B) of this section, an unincorporated nonprofit association may not pay dividends or distribute any part of its income or profits to a member, manager, officer, or other private person.

(B) An unincorporated nonprofit association may do any of the following:

(1) Pay reasonable compensation or reimburse reasonable expenses to a member or manager for services rendered;

(2) Confer benefits on a member or manager in conformity with its nonprofit purposes;

(3) Repurchase a membership and repay a capital contribution made by a member to the extent authorized by its governing principles;

(4) Make distributions of property to members upon winding up and termination to the extent permitted by section 1745.52 of the Revised Code.

Section 1745.41 | Removal of managers and filling vacancies.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) The office of a manager becomes vacant if the manager dies or resigns. A resignation under this division takes effect immediately or at any other time that the manager may specify.

(B) A manager may be removed from office pursuant to any procedure for removal from office provided in the governing principles. That removal from office creates a vacancy.

(C) Unless the governing principles provide otherwise, the remaining managers, although less than a majority of the whole authorized number of managers, may by the vote of a majority of their number fill any vacancy in the office of manager for the unexpired term. For purposes of this section, a vacancy exists if the voting members increase the authorized number of managers but fail at the meeting at which that increase is authorized or an adjournment of the meeting to elect the additional managers provided for or if the voting members fail at any time to elect the whole authorized number of managers.

Section 1745.42 | Interest of member, manager or officer in contract.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) Unless otherwise provided in the governing principles, the following apply:

(1) No contract, action, or transaction is void or voidable with respect to an unincorporated nonprofit association because the contract, action, or transaction is between or affects the association and one or more of its members, managers, or officers or is between or affects the association and any other person in which one or more of the association's members, managers, or officers are members, managers, or officers or in which one or more of the association's members, managers, or officers have a financial or personal interest, or because one or more interested members, managers, or officers participate in or vote at the meeting of the members, the managers, or a committee of the managers that authorizes the contract, action, or transaction, if any of the following applies:

(a) The material facts as to the member's, manager's, or officer's relationship or interest and as to the contract, action, or transaction are disclosed or are known to the managers or the committee, and the managers or committee, in good faith reasonably justified by the material facts, authorizes the contract, action, or transaction by the affirmative vote of a majority of the disinterested managers, even though the disinterested managers constitute less than a quorum of the managers or the committee.

(b) The material facts as to the member's, manager's, or officer's relationship or interest and as to the contract, action, or transaction are disclosed or are known to the members entitled to vote on the contract, action, or transaction, and the contract, action, or transaction is specifically approved at a meeting of the members held for the purpose of voting on the contract, action, or transaction, by the affirmative vote of a majority of the voting members of the unincorporated nonprofit association who are not interested in the contract, action, or transaction.

(c) The contract, action, or transaction is fair as to the unincorporated nonprofit association as of the time it is authorized or approved by the managers, a committee of the managers, or the members.

(2) Common or interested managers may be counted in determining the presence of a quorum at a meeting of the managers or a committee of the managers that authorizes the contract, action, or transaction.

(3) The managers, by the affirmative vote of a majority of those in office and irrespective of any financial or personal interest of any of the managers, have the authority to establish reasonable compensation, which may include pension, disability, and death benefits, for services to the unincorporated nonprofit association by the managers and officers, or to delegate that authority to establish reasonable compensation to one or more officers or managers.

(B) Divisions (A)(1) and (2) of this section do not limit or otherwise affect the liability of managers under section 1745.56 of the Revised Code.

(C) For purposes of division (A) of this section, a manager is not an interested manager solely because the subject of a contract, action, or transaction may involve or effect a change in control of the unincorporated nonprofit association or the manager's continuation in office as a manager of the association.

(D) For purposes of this section, "action" means a resolution that is adopted by the managers or a committee of the managers.

Section 1745.43 | Indemnification; advancement of expenses.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) An unincorporated nonprofit association may indemnify or agree to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending, or completed civil, criminal, administrative, or investigative action, suit, or proceeding, other than an action by or in the right of the association, by reason of the fact that the person is or was a manager, officer, employee, member, agent, or volunteer of the association or a person acting in any other representative capacity, however denominated, or is or was serving at the request of the association as a director, officer, employee, member, manager, agent, or volunteer of any other entity, against expenses, including attorney's fees, judgments, fines, and amounts paid in settlement actually and reasonably incurred by the person in connection with that action, suit, or proceeding, if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the association, and, with respect to any criminal action or proceeding if the person had no reasonable cause to believe the person's conduct was unlawful. The termination of any action, suit, or proceeding by judgment, order, settlement, or conviction, or upon a plea of nolo contendere or its equivalent, shall not create, of itself, a presumption that the person did not act in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the association, and, with respect to any criminal action or proceeding, a presumption that the person had reasonable cause to believe that the person's conduct was unlawful.

(B) An unincorporated nonprofit association may indemnify or agree to indemnify any person who was or is a party, or is threatened to be made a party, to any threatened, pending, or completed action or suit by or in the right of the association to procure a judgment in its favor by reason of the fact that the person is or was a manager, officer, employee, member, agent, or volunteer of the association or a person acting in any other representative capacity, however denominated, or is or was serving at the request of the association as a director, officer, employee, member, manager, agent, or volunteer of any other entity, against expenses, including attorney's fees, actually and reasonably incurred by the person in connection with the defense or settlement of that action or suit if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the association, except that no indemnification shall be made with respect to any of the following:

(1) Any claim, issue, or matter as to which the person is adjudged to be liable for negligence or misconduct in the performance of the person's duty to the unincorporated nonprofit association unless and only to the extent that the court of common pleas or the court in which the action or suit was brought determines, upon application, that despite the adjudication of liability but in view of all the circumstances of the case, the person is fairly and reasonably entitled to indemnity for the expenses that the court of common pleas or that other court considers proper;

(2) Any action or suit in which liability is asserted against a manager and that liability is asserted only pursuant to section 1745.56 of the Revised Code.

(C) To the extent that a manager, officer, employee, member, agent, or volunteer of the association or a person acting in any other representative capacity, however denominated, has been successful on the merits or otherwise in defense of any action, suit, or proceeding referred to in division (A) or (B) of this section, or in defense of any claim, issue, or matter in the action, suit, or proceeding, that person shall be indemnified against expenses, including attorney's fees, actually and reasonably incurred by the person in connection with that action, suit, or proceeding.

(D)(1) Unless ordered by a court and subject to division (C) of this section, any indemnification under division (A) or (B) of this section shall be made by the unincorporated nonprofit association only as authorized in the specific case upon a determination that indemnification of the manager, officer, employee, member, agent, or volunteer of the association or the person acting in any other representative capacity, however denominated, is proper in the circumstances because the person has met the applicable standard of conduct set forth in division (A) or (B) of this section. That determination shall be made in any of the following manners:

(a) By a majority vote of a quorum consisting of managers of the indemnifying unincorporated nonprofit association who were not and are not parties to or threatened with the action, suit, or proceeding referred to in division (A) or (B) of this section;

(b) Whether or not a quorum as described in division (D)(1)(a) of this section is obtainable, and if a majority of a quorum of disinterested managers so directs, in a written opinion by independent legal counsel other than an attorney, or a firm having associated with an attorney, who has been retained by or has performed services for the association or any person to be indemnified within the past five years;

(c) By the members;

(d) By the court of common pleas or the court in which the action, suit, or proceeding referred to in division (A) or (B) of this section was brought.

(2) If an action or suit by or in the right of the unincorporated nonprofit association is involved, any determination made by the disinterested managers under division (D)(1)(a) of this section or by independent legal counsel under division (D)(1)(b) of this section shall be communicated promptly to the person who threatened or brought the action or suit under division (B) of this section, and, within ten days after receipt of that notification, the person shall have the right to petition the court of common pleas or the court in which the action or suit was brought to review the reasonableness of that determination.

(E)(1)(a) Unless at the time of a manager's or volunteer's act or omission that is the subject of an action, suit, or proceeding referred to in division (A) or (B) of this section the governing principles of the unincorporated nonprofit association stated, by specific reference to division (E)(1)(a) of this section, that its provisions do not apply to the association, unless the only liability asserted against a manager in an action, suit, or proceeding referred to in division (A) or (B) of this section is pursuant to section 1745.56 of the Revised Code, or unless division (E)(1)(b) of this section applies, the expenses, including attorney's fees, incurred by the manager or volunteer in defending the action, suit, or proceeding shall be paid by the unincorporated nonprofit association. Upon the request of the manager or volunteer and in accordance with division (E)(2) of this section, those expenses shall be paid as they are incurred, in advance of the final disposition of the action, suit, or proceeding.

(b) Notwithstanding division (E)(1)(a) of this section, the expenses incurred by a manager or volunteer in defending an action, suit, or proceeding referred to in division (A) or (B) of this section, including attorney's fees, shall not be paid by the unincorporated nonprofit association upon the final disposition of the action, suit, or proceeding, or, if paid in advance of the final disposition of the action, suit, or proceeding, shall be repaid to the association by the manager or volunteer, if it is proved, by clear and convincing evidence, in a court with jurisdiction that the act or omission of the manager or volunteer was one undertaken with a deliberate intent to cause injury to the association or was one undertaken with a reckless disregard for the best interests of the association.

(2) Expenses, including attorney's fees, incurred by a manager, officer, employee, member, agent, or volunteer of the association or a person acting in any other representative capacity, however denominated, in defending any action, suit, or proceeding referred to in division (A) or (B) of this section may be paid by the unincorporated nonprofit association as they are incurred, in advance of the final disposition of the action, suit, or proceeding, as authorized by the managers in the specific case, upon receipt of an undertaking by or on behalf of the manager, officer, employee, member, agent, volunteer, or person acting in any other representative capacity to repay the amount if it ultimately is determined that the person is not entitled to be indemnified by the association.

(F) The indemnification authorized by this section is not exclusive of, and shall be in addition to, any other rights granted to those seeking indemnification pursuant to the governing principles, any agreement, a vote of the members or disinterested managers, or otherwise, both as to action in their official capacities and as to action in another capacity while holding their offices or positions, shall continue as to a person who has ceased to be a manager, officer, employee, member, agent, or volunteer of the association or a person acting in any other representative capacity, however denominated, and shall inure to the benefit of the heirs, executors, and administrators of that person.

(G) An unincorporated nonprofit association may purchase and maintain insurance, or furnish similar protection, including, but not limited to, trust funds, letters of credit, or self-insurance, for or on behalf of any person who is or was a manager, officer, employee, member, agent, or volunteer of the association or a person acting in any other representative capacity, however denominated, or is or was serving at the request of the association as a director, manager, officer, employee, member, agent, or volunteer of any other entity, against any liability asserted against the person and incurred by the person in that capacity, or arising out of the person's status as such, whether or not the association would have the power to indemnify the person against that liability under this section. Insurance may be so purchased from or so maintained with a person in which the association has a financial interest.

(H) The authority of an unincorporated nonprofit association to indemnify persons pursuant to division (A) or (B) of this section does not limit the payment of expenses as they are incurred, in advance of the final disposition of an action, suit, or proceeding, pursuant to division (E) of this section or the payment of indemnification, insurance, or other protection that may be provided pursuant to division (F) or (G) of this section. Divisions (A) and (B) of this section do not create any obligation to repay or return payments made by the association pursuant to division (E), (F), or (G) of this section.

(I) As used in this section, "unincorporated nonprofit association" includes all constituent entities in a consolidation or merger, and the new or surviving entity, so that any person who is or was a manager, officer, employee, member, agent, or volunteer of a constituent entity or a person acting in any other representative capacity, however denominated, or is or was serving at the request of a constituent entity as a director, officer, employee, member, manager, agent, or volunteer of any other entity, shall stand in the same position under this section with respect to the new or surviving entity as the person would if the person had served the new or surviving entity in the same capacity.

Section 1745.44 | Sale or other disposition of assets.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) Unless the governing principles of the unincorporated nonprofit association provide otherwise, the lease, sale, exchange, transfer, or other disposition of any assets of the association may be made without the necessity of procuring authorization from the court under section 1715.39 of the Revised Code, upon terms and for the consideration that may be authorized by the managers, except that a lease, sale, exchange, transfer, or other disposition of all, or substantially all, of the assets may be made only when that transaction is also authorized, either before or after authorization by the managers, by the voting members of the association at a meeting held for that purpose.

(B)(1) A public benefit association may not dispose of its assets with value equal to more than fifty per cent of the fair market value of the net tangible and intangible assets, including goodwill, of the association over a period of thirty-six consecutive months in a transaction or series of transactions, including the lease, sale, exchange, transfer, or other disposition of those assets, that are outside the ordinary course of its business or that are not in accordance with the purpose or purposes for which the association was organized, as set forth in its governing principles, unless one or more of the following apply:

(a) The transaction has received the prior approval of the court of common pleas of the county in this state in which the principal office of the public benefit association is located in a proceeding of which the attorney general's charitable law section has been given written notice by certified mail within three days of the initiation of the proceeding and in which proceeding the attorney general may intervene as of right.

(b) The public benefit association has provided written notice of the proposed transaction, including a copy or summary of the terms of that transaction, at least twenty days before consummation of the lease, sale, exchange, transfer, or other disposition of the assets, to the attorney general's charitable law section and to the members of the association, and the proposed transaction has been approved by the members.

(c) The transaction is in accordance with the purpose or purposes for which the public benefit association was organized, as set forth in its governing principles, and the lessee, purchaser, or transferee of the assets is a public benefit entity.

(2) The attorney general may require pursuant to section 109.24 of the Revised Code the production of the documents necessary for review of a proposed transaction under division (B)(1) of this section. The attorney general may retain at the expense of the public benefit association one or more experts, including an investment banker, actuary, appraiser, certified public accountant, or other expert, that the attorney general considers reasonably necessary to provide assistance in reviewing a proposed transaction under division (B)(1) of this section.

(C) The attorney general may institute a civil action to enforce the requirements of division (B)(1) of this section in the court of common pleas of the county in this state in which the principal office of the public benefit association is located or in the Franklin county court of common pleas. In addition to any civil remedies that may exist under common law or the Revised Code, a court may rescind the transaction or grant injunctive relief or impose any combination of these remedies.

(D) The unincorporated nonprofit association or the public benefit association by its managers may abandon the proposed lease, sale, exchange, transfer, or other disposition of the assets of the association pursuant to division (A) or (B) of this section, as applicable, subject to the contract rights of other persons, if that power of abandonment is conferred upon the managers either by the terms of the transaction or by the same vote of members and at the same meeting of members as that referred to in division (A) or (B) of this section, as applicable, or at any subsequent meeting.

(E) An action to set aside a conveyance by an unincorporated nonprofit association or a public benefit association on the ground that any section of the Revised Code applicable to the lease, sale, exchange, transfer, or other disposition of the assets of that association has not been complied with shall be brought within one year after that transaction, or the action shall be forever barred.

Section 1745.45 | Judicial sale of assets.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

Property of any description and any interest in the property of an unincorporated nonprofit association, domestic or foreign, may be sold under the judgment or decree of a court, as provided in the Revised Code with respect to similar property of natural persons, at a public or private sale in the manner, at the time and place, on the notice by publication or otherwise, and on the terms that the court adjudging or decreeing that sale considers equitable and proper. It is not necessary to appraise that property or to advertise the sale of the property otherwise than as the court adjudges or decrees.

Section 1745.46 | Merger or consolidation into domestic unincorporated nonprofit association.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A)(1) Pursuant to an agreement of merger, an unincorporated nonprofit association and one or more additional domestic or foreign entities may be merged into a surviving unincorporated nonprofit association. Pursuant to an agreement of consolidation, one or more domestic or foreign entities may be consolidated into a new unincorporated nonprofit association. If any constituent entity is formed or organized under the laws of any state other than this state or under any chapter of the Revised Code other than this chapter, the merger or consolidation also must be permitted by the chapter of the Revised Code under which each domestic constituent entity exists and by the laws under which each foreign constituent entity exists.

(2) To effect a merger or consolidation under this section, the manager or managers of each constituent unincorporated nonprofit association shall approve an agreement of merger or consolidation to be signed by the manager, the chairperson, the president, or a vice-president and by the secretary or an assistant secretary or, if there are no officers, by one or more authorized managers. The agreement of merger or consolidation shall be approved or otherwise authorized by or on behalf of each other constituent entity in accordance with the laws under which it exists.

(3) The agreement of merger or consolidation shall set forth all of the following:

(a) The name and the form of entity of each constituent entity and the state under the laws of which each constituent entity exists;

(b) That the named constituent entities have agreed to merge into a specified constituent unincorporated nonprofit association, designated in this section as the surviving unincorporated nonprofit association, or that the named constituent entities have agreed to consolidate into a new unincorporated nonprofit association to be formed by the consolidation, designated in this section as the new unincorporated nonprofit association;

(c) All statements and matters required to be set forth in an agreement of merger or consolidation by the laws under which each constituent entity exists;

(d) The name of the surviving or new unincorporated nonprofit association, which may be the same as or similar to that of any constituent unincorporated nonprofit association;

(e) The place in this state where the principal office of the surviving or new unincorporated nonprofit association is to be located;

(f) The names and addresses of the first managers and officers, if any, of the surviving or new unincorporated nonprofit association and, if desired, their term or terms of office;

(g) The name and address of the statutory agent, if any, upon whom any process, notice, or demand against any constituent entity or the surviving or new unincorporated nonprofit association may be served;

(h) The terms of the merger or consolidation and the mode of carrying those terms into effect;

(i) The governing principles of the surviving or new unincorporated nonprofit association or a provision to the effect that the governing principles of a specified constituent unincorporated nonprofit association shall be the governing principles of the surviving or new unincorporated nonprofit association or to the effect that the voting members or the managers of the surviving or new unincorporated nonprofit association may adopt governing principles, or any combination of them.

(4) The agreement of merger or consolidation also may set forth any of the following:

(a) The specification of a date, which may be the date of the filing of the agreement or a date subsequent to that date of filing, upon which the merger or consolidation shall become effective;

(b) A provision conferring upon the managers of one or more of the constituent unincorporated nonprofit associations or the comparable representatives of any other constituent entity the power to abandon the merger or consolidation prior to the filing of the agreement;

(c) Any additional provision permitted to be included in the governing principles of a newly formed unincorporated nonprofit association;

(d) Any additional provision considered necessary or desirable with respect to the proposed merger or consolidation.

(B)(1) A merger or consolidation in which a public benefit association is one of the constituent entities shall be approved by the court of common pleas of the county in this state in which the principal office of the public benefit association is located in a proceeding of which the attorney general's charitable law section has been given written notice by certified mail within three days of the initiation of the proceeding and in which the attorney general may intervene as of right. No approval by the court under division (B)(1) of this section is required if either of the following applies:

(a) A public benefit association is the surviving entity in the case of a merger and continues to be a public benefit association or is the new unincorporated nonprofit association in the case of a consolidation and continues to be a public benefit association.

(b) A public benefit association is not the surviving entity in the case of a merger or is not the new unincorporated nonprofit association in the case of a consolidation, and all of the following apply:

(i) On or prior to the effective date of the merger or consolidation, assets with a value equal to the greater of the fair market value of the net tangible and intangible assets, including goodwill, of the public benefit association or the fair market value of the public benefit association if it is to be operated as a business concern, are transferred or conveyed to one or more persons that would have received its assets under division (D)(2) of section 1745.52 of the Revised Code had it voluntarily dissolved.

(ii) The public benefit association returns, transfers, or conveys any assets held by it upon a condition requiring return, transfer, or conveyance, which condition occurs by reason of the merger or consolidation, in accordance with that condition.

(iii) The merger or consolidation is approved by a majority of managers of the public benefit association who will not receive any financial or other benefit, directly or indirectly, as a result of the merger or consolidation or by agreement, and who are not and will not as a result of the merger or consolidation become members, partners, or other owners, however denominated, of, shareholders in, managers, officers, employees, agents, or other representatives of, or consultants to, the surviving or new entity.

(2) At least twenty days before consummation of any merger or consolidation of a public benefit association pursuant to division (B)(1)(b) of this section, written notice shall be delivered to the attorney general's charitable law section. The notice shall include a copy of the proposed plan of merger or consolidation. The attorney general's charitable law section may review a proposed merger or consolidation of a public benefit association under division (B)(1)(b) of this section. The attorney general may require pursuant to section 109.24 of the Revised Code the production of the documents necessary for review of a proposed merger or consolidation under division (B)(1)(b) of this section. The attorney general may retain, at the expense of the public benefit association, one or more experts, including an investment banker, actuary, appraiser, certified public accountant, or other expert, that the attorney general considers reasonably necessary to provide assistance in reviewing a proposed merger or consolidation under division (B)(1)(b) of this section. The attorney general may extend the date of any merger or consolidation of a public benefit association under division (B)(1)(b) of this section for a period not to exceed sixty days and shall provide notice of that extension to the public benefit association. The notice shall set forth the reasons necessitating the extension.

(3) No member, other than a member that is a public benefit entity, or manager of a public benefit association in that person's capacity as a member or manager may receive or keep anything as a result of a merger or consolidation other than as a member or manager in the surviving or new public benefit association without the prior written consent of the attorney general or of the court of common pleas of the county in this state in which the principal office of the public benefit association is located in a proceeding in which the attorney general's charitable law section has been given written notice by certified mail within three days of the initiation of the proceeding and in which the attorney general may intervene as of right. The court shall approve the transaction if it is in the public interest.

(4) The attorney general may institute a civil action to enforce the requirements of divisions (B)(1), (2), and (3) of this section in the court of common pleas of the county in this state in which the principal office of the public benefit association is located or in the Franklin county court of common pleas. In addition to any civil remedies that may exist under common law or the Revised Code, a court may rescind the transaction or grant injunctive relief or impose any combination of these remedies.

Section 1745.461 | Merger or consolidation into entity other than domestic unincorporated nonprofit association.

• Effective: April 12, 2021
• Latest Legislation: Senate Bill 276 - 133rd General Assembly

(A)(1) Pursuant to an agreement of merger between the constituent entities as provided in this section, a domestic unincorporated nonprofit association and, if so provided, one or more additional domestic or foreign entities may be merged into a surviving entity other than a domestic unincorporated nonprofit association. Pursuant to an agreement of consolidation, a domestic unincorporated nonprofit association together with one or more additional domestic or foreign entities may be consolidated into a new entity other than a domestic unincorporated nonprofit association to be formed by that consolidation. The merger or consolidation must be permitted by the chapter of the Revised Code under which each domestic constituent entity exists and by the laws under which each foreign constituent entity exists.

(2) To effect a merger or consolidation under this section, the manager or managers of each constituent unincorporated nonprofit association shall approve an agreement of merger or consolidation to be signed by the manager, the chairperson, the president, or a vice-president and by the secretary or an assistant secretary or, if there are no officers, by an authorized manager. The agreement of merger or consolidation shall be approved or otherwise authorized by or on behalf of each other constituent entity in accordance with the laws under which it exists.

(3) The agreement of merger or consolidation shall set forth all of the following:

(a) The name and the form of entity of each constituent entity and the state under the laws of which each constituent entity exists;

(b) In the case of a merger, that one or more specified constituent entities will be merged into a specified surviving foreign entity or surviving domestic entity other than a domestic unincorporated nonprofit association or, in the case of a consolidation, that the constituent entities will be consolidated into a new foreign entity or domestic entity other than a domestic unincorporated nonprofit association. The name of the surviving or new entity may be the same as or similar to that of any constituent entity.

(c) The terms of the merger or consolidation and the mode of carrying those terms into effect;

(d) If the surviving or new entity is a foreign unincorporated nonprofit association, all additional statements and matters, other than the name and address of the statutory agent, that would be required by section 1745.46 of the Revised Code if the surviving or new unincorporated nonprofit association were a domestic unincorporated nonprofit association;

(e) The name and the form of entity of the surviving or new entity, the state under the laws of which the surviving entity exists or the new entity is to exist, and the location of the principal office of the surviving or new entity in that state;

(f) All statements and matters required to be set forth in an agreement of merger or consolidation by the laws under which each constituent entity exists and, in the case of a consolidation, the new entity is to exist;

(g) The consent of the surviving or the new entity to be sued and served with process in this state and the irrevocable appointment of the secretary of state as its agent to accept service of process in any proceeding in this state to enforce against the surviving or new entity any obligation of any domestic constituent unincorporated nonprofit association. Such service shall be made upon the secretary of state by leaving duplicate copies of such process, together with an affidavit of the plaintiff or one of the plaintiff's attorneys, showing the last known address of such association, and a fee of up to five dollars that shall be included as taxable costs in the case of judicial proceedings. Upon receipt of such process, affidavit, and fee, the secretary of state shall immediately give notice to the association at the address specified in the affidavit and forward to such address by certified mail, with a request for return receipt, a copy of such process.

(h) If the surviving or new entity is a foreign unincorporated nonprofit association that desires to transact business in this state as a foreign unincorporated nonprofit association, a statement to that effect, together with a statement regarding the appointment of a statutory agent and service of any process, notice, or demand upon that statutory agent or the secretary of state;

(i) If the surviving or new entity is a foreign limited partnership that desires to transact business in this state as a foreign limited partnership, a statement to that effect, together with all of the information required under section 1782.49 of the Revised Code when a foreign limited partnership registers to transact business in this state;

(j) If the surviving or new entity is a foreign limited liability company that desires to transact business in this state as a foreign limited liability company, a statement to that effect, together with all of the information required under section 1705.54 or 1706.511 of the Revised Code when a foreign limited liability company registers to transact business in this state;

(k) If the surviving or new entity is a foreign unincorporated association that desires to transact business in this state as a foreign unincorporated association, a statement to that effect, together with all of the information, if any, required by the secretary of state when a foreign unincorporated association registers to transact business in this state.

(4) The agreement of merger or consolidation also may set forth any additional provision permitted by the laws of any state under the laws of which any constituent entity exists, consistent with the laws under which the surviving entity exists or the new entity is to exist.

(B) A merger or consolidation pursuant to this section in which a public benefit association is one of the constituent entities shall be subject to, and shall comply with, the provisions of divisions (B)(1)(b), (2), (3), and (4) of section 1745.46 of the Revised Code.

Last updated September 10, 2021 at 9:02 AM

Section 1745.47 | Agreement of merger or consolidation; vote by members.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) The managers of each constituent domestic unincorporated nonprofit association, upon approving an agreement of merger or consolidation, shall direct that the agreement be submitted to the members entitled to vote on it at a meeting of voting members of that unincorporated nonprofit association held for that purpose. Notice of the meeting shall be given to all members of the constituent domestic unincorporated nonprofit association entitled to vote at the meeting. The notice shall be accompanied by a copy or summary of the material terms of the agreement.

(B)(1) In order to be adopted, the agreement, including any amendments or additions to the agreement proposed at each meeting described in division (A) of this section, shall receive the affirmative vote of a majority of the voting members of the constituent domestic unincorporated nonprofit association present at that meeting in person, by the use of authorized communications equipment, by mail, or if permitted, by proxy if a quorum is present, or, if the governing principles provide or permit, the affirmative vote of a greater or lesser proportion or number of the voting members, and the affirmative vote of the voting members of any particular class that is required by the governing principles. If the agreement would effect or authorize any action by the unincorporated nonprofit association that, under any applicable provision of law or under the governing principles of the constituent domestic unincorporated nonprofit association, could be effected or authorized only by or pursuant to a specified vote of the members, the agreement, including any amendments or additions to the agreement proposed at each meeting described in division (A) of this section, shall be adopted by the same vote as would be required for that action.

(2) For purposes of division (B)(1) of this section, participation by a voting member at a meeting through the use of any of the means of communication described in that division constitutes presence in person of that voting member at the meeting for purposes of determining a quorum.

(C) At any time prior to the filing of the agreement, the merger or consolidation may be abandoned by the managers of one or more of the constituent unincorporated nonprofit associations or the comparable representatives of any other constituent entity, if the power of abandonment is conferred either by the agreement or by the same vote or action as is required to adopt that agreement.

Section 1745.48 | Effect of merger or consolidation.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) When a merger or consolidation becomes effective, all of the following apply:

(1) The separate existence of each constituent entity other than the surviving entity in a merger shall cease, except that whenever a conveyance, assignment, transfer, deed, or other instrument or act is necessary to vest property or rights in the surviving or new entity, the officers, managers, general partners, or other authorized representatives of the respective constituent entities shall execute, acknowledge, and deliver those instruments and do those acts. For these purposes, the existence of the constituent entities and the authority of their respective officers, managers, general partners, or other authorized representatives is continued notwithstanding the merger or consolidation.

(2) In the case of a merger in which the surviving entity is a domestic unincorporated nonprofit association, the governing principles of the domestic surviving unincorporated nonprofit association in effect immediately prior to the time the merger becomes effective shall continue as its governing principles after the merger except as otherwise provided in the agreement of merger. In the case of a consolidation, the new entity exists when the consolidation becomes effective and, if it is a domestic unincorporated nonprofit association, the governing principles contained in or provided for in the agreement of consolidation shall be its governing principles.

(3) The surviving or new entity possesses all assets and property of every description and every interest in the assets and property, wherever located, the rights, privileges, immunities, powers, franchises, and authority, of a public as well as of a private nature, of each constituent entity, and all obligations belonging to or due to each constituent entity, all of which are vested in the surviving or new entity without further act or deed. Any right or interest in respect to any past or future devise, bequest, conditional gift, or trust, property, or fund restricted to particular uses, when vested in or claimed by the surviving or new entity as a result of the merger or consolidation, shall belong to it as a continuation without interruption of the existence and identity of the constituent entity originally named as taker or beneficiary. The surviving or new entity possesses title to any real estate or any interest in the real estate vested in any of the constituent entities. Title to any real estate or any interest in the real estate vested in any constituent entity shall not revert or in any way be impaired by reason of the merger or consolidation.

(4) The surviving or new entity is liable for all of the obligations of each constituent entity. Any claim existing or any action or proceeding pending by or against any constituent entity may be prosecuted to judgment, with right of appeal, as if the merger or consolidation had not taken place, or the surviving or new entity may be substituted in its place.

(5) All of the rights of creditors of each constituent entity are preserved unimpaired, and all liens upon the property of any constituent entity are preserved unimpaired on only the property affected by those liens immediately prior to the effective date of the merger or consolidation. If a general partner of a constituent partnership is not a general partner of the surviving entity or the new entity resulting from the merger or consolidation, the former general partner has no liability for any obligation incurred after the merger or consolidation except to the extent that a former creditor of the constituent partnership in which the former general partner was a partner extends credit to the surviving or new entity reasonably believing that the former general partner continued as a general partner of the surviving or new entity.

(B) If a general partner of a constituent partnership is not a general partner of the surviving entity or the new entity resulting from the merger or consolidation, division (B) of section 1782.434 of the Revised Code applies.

(C) In the case of a merger of a domestic constituent unincorporated nonprofit association into a foreign surviving unincorporated nonprofit association, limited liability company, limited partnership, or unincorporated association that is not licensed or registered to transact business in this state or in the case of a consolidation of a domestic constituent unincorporated nonprofit association into a new foreign unincorporated nonprofit association, limited liability company, limited partnership, or unincorporated association, if the surviving or new entity intends to transact business in this state, the surviving or new entity shall comply with all of the requirements that are necessary for that entity to transact business in this state as a foreign unincorporated nonprofit association, limited liability company, limited partnership, or unincorporated association, whichever is applicable.

(D) Any action to set aside any merger or consolidation on the ground that any section of the Revised Code applicable to the merger or consolidation has not been complied with shall be brought within ninety days after the effective date of that merger or consolidation or be forever barred.

(E) As used in this section, "unincorporated nonprofit association" or "entity" applies to both domestic and foreign unincorporated nonprofit associations or entities if the context so permits. In the case of a foreign constituent entity or a foreign new entity, this section is subject to the laws of the state under the laws of which the entity exists or in which it has property.

Section 1745.49 | Effective date of merger or consolidation.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

The merger or consolidation shall become effective at the time that the constituent entities have complied with the laws of each state under the laws of which the constituent entities exist or at any later date that the agreement of merger or consolidation specifies.

Section 1745.50 | Voluntary dissolution.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) An unincorporated nonprofit association may be dissolved voluntarily in the manner provided in this section.

(B) A resolution of dissolution for an unincorporated nonprofit association shall set forth all of the following:

(1) That the association elects to be dissolved;

(2) Any additional provision considered necessary with respect to the proposed dissolution and winding up of affairs.

(C) The managers of an unincorporated nonprofit association may adopt a resolution of dissolution in any of the following cases:

(1) If the association has been adjudged bankrupt or has made a general assignment for the benefit of creditors;

(2) By leave of the court, if a receiver has been appointed in a general creditors' suit or in any suit in which the affairs of the association are to be wound up;

(3) If substantially all of the assets of the association have been sold at judicial sale;

(4) When the period of existence of the association specified in its governing principles has expired or upon the occurrence of another event or condition specified in its governing principles;

(5) If no members of the association can be identified and the association's operations have been discontinued for at least three years by the managers or, if the association has no incumbent managers, by its last preceding incumbent manager.

(D) The members of an unincorporated nonprofit association may adopt a resolution of dissolution by the affirmative vote of the members.

Section 1745.51 | Notice of voluntary dissolution.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

Following the adoption of a resolution of dissolution, the managers in an expeditious manner shall do both of the following:

(A) Cause a notice of voluntary dissolution to be published once a week on the same day of each week for two successive weeks, in a newspaper published and of general circulation in the county in which the principal office of the unincorporated nonprofit association was to be or is located;

(B) Cause written notice of dissolution to be given either personally or by mail to all known creditors of, and to all known claimants against, the dissolved association. If a statement is on file with the secretary of state appointing an agent authorized to receive service of process on the association, or if any other document is on file with the secretary of state with respect to the association, a copy of the written notice of dissolution shall also be filed with the secretary of state.

Section 1745.52 | Effect of voluntary dissolution and authority and duties of managers during winding up.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) When an unincorporated nonprofit association is dissolved voluntarily upon the expiration of the period of existence of the association specified in its governing principles, the association shall cease to carry on its activities and shall do only those acts that are required to wind up its affairs, and for those purposes it shall continue as an unincorporated nonprofit association.

(B) Any claim existing or action or proceeding pending by or against the unincorporated nonprofit association or that would have accrued against it may be prosecuted to judgment with right of appeal as in other cases, but any proceeding, execution, or process, or the satisfaction or performance of any order, judgment, or decree, may be stayed as provided in section 1745.53 of the Revised Code.

(C) Any process, notice, or demand against the unincorporated nonprofit association may be served by delivering a copy to a manager, liquidator, or person having charge of its assets or, if none of those persons can be found, to the statutory agent.

(D) The managers of the unincorporated nonprofit association and their survivors or successors shall act in accordance with the governing principles until the affairs of the association are completely wound up. Subject to the orders of courts of this state having jurisdiction over the association, the managers shall proceed as speedily as is practicable to a complete winding up of the affairs of the association and, to the extent necessary or expedient to that end, shall exercise all the authority of the association. Without limiting the generality of that authority, they may fill vacancies, elect managers, carry out contracts of the association, make new contracts, borrow money, mortgage or pledge the property of the association as security, sell its assets at public or private sale, make conveyances in the association's name, lease real property for any term, including ninety-nine years renewable forever, settle or compromise claims in favor of or against the association, employ one or more persons as liquidators to wind up the affairs of the association with the authority that the managers see fit to grant, cause the title to any of the assets of the association to be conveyed to those liquidators for that purpose, apply assets to the payment of obligations, perform all other acts necessary or expedient to the winding up of the affairs of the association, and, after paying or adequately providing for the payment of all known obligations of the association, distribute the remainder of the assets as follows:

(1) Assets held upon a condition requiring return, transfer, or conveyance, which condition will have occurred by reason of the dissolution or otherwise, shall be returned, transferred, or conveyed in accordance with those requirements;

(2) In the case of a public benefit association, the following apply:

(a) Assets held by it in trust for specified purposes shall be applied so far as is feasible in accordance with the terms of the trust.

(b) The remaining assets not held in trust shall be applied so far as is feasible towards carrying out the purposes stated in its governing principles.

(c) In the event and to the extent that in the judgment of the managers it is not feasible to apply the assets as provided in divisions (D)(2)(a) and (b) of this section, the assets shall be applied as may be directed by the court of common pleas of the county in this state in which the principal office of the association is located, in an action brought for that purpose by the managers or any one of them or by the association, to which action the attorney general shall be a party, in an action brought by the attorney general in a court of competent jurisdiction, or in an action brought as provided in section 1745.53 of the Revised Code for the purpose of winding up the affairs of the association under the supervision of the court.

(3) In the case of a mutual benefit association, any remaining assets shall be distributed in accordance with the applicable provisions of the governing principles of the association or, to the extent that no such provision is made, the assets shall be distributed pursuant to a plan of distribution adopted by the members of the association at a meeting held for the purpose of voting on dissolution or any adjournment of the meeting. If no plan of distribution is so adopted by the members, those remaining assets shall be distributed pursuant to a plan of distribution adopted by the managers. If no plan of distribution is so adopted by the members or managers, the remaining assets shall be applied in the manner directed by the court of common pleas of the county in this state in which the principal office of the association is located, in an action brought for that purpose by the mutual benefit association, by the managers or any one of them, or by the attorney general in a court of competent jurisdiction or in an action brought as provided in section 1745.53 of the Revised Code for the purpose of winding up the affairs of the association under the supervision of the court.

(E) Without limiting the authority of the managers, any action within the purview of this section that is authorized or approved by the members at a meeting held for that purpose shall be conclusive for all purposes upon all of the members of the association, except that nothing in this section shall impair the jurisdiction of courts of competent jurisdiction to enforce the duties of a public benefit association with respect to the application of its assets towards its public or charitable purposes, or impair the power of the state, acting through the attorney general, to require those assets to be applied, as nearly as may be, towards its public or charitable purposes.

(F) All deeds and other instruments of the unincorporated nonprofit association shall be in the name of the association and shall be executed, acknowledged, and delivered by a manager of the association.

(G) At any time during the winding up of its affairs, the unincorporated nonprofit association by its managers may make application to the court of common pleas of the county in this state in which the principal office of the association is located to have the winding up continued under supervision of the court as provided in section 1745.53 of the Revised Code.

Section 1745.53 | Jurisdiction of court over winding up of affairs of voluntarily dissolved unincorporated nonprofit association.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) Without limiting the generality of its authority, the court of common pleas of the county in this state in which is located the principal office of a voluntarily dissolved unincorporated nonprofit association or of an unincorporated nonprofit association whose period of existence has expired, upon the complaint of the association, a majority of the managers, or a creditor or member of the association and upon notice to all of the managers and any other interested persons that the court considers proper, at any time may order and adjudge in regard to the following matters:

(1) The presentation and proof of all claims and demands against the association and of all rights, interests, or liens in or on any of its property, the fixing of the time within which and the manner in which that proof shall be made and the person to whom that presentation shall be made, and the barring from participation in any distribution of assets of all persons failing to make and present proofs as required by the order of the court;

(2) The stay of the prosecution of any proceeding against the association or involving any of its property, and the requirement that the parties to it present and prove their claims, demands, rights, interests, or liens at the time and in the manner required of creditors or others, or the grant of leave to bring or maintain an independent proceeding to enforce liens;

(3) The settlement or determination of all claims of every nature against the association or any of its property, the determination of the assets required to be retained to pay or provide for the payment of those claims or any claim, the determination of the assets available for distribution among members and others, and the making of new parties to the proceeding so far as the court considers proper for the determination of all matters;

(4) The determination of the rights of members or others in and to the assets of the association;

(5) The presentation and the filing of intermediate and final accounts of the managers or of the liquidators and hearings on them, the allowance, disallowance, or settlement of those accounts, and the discharge of the managers, the liquidators, or any of them from their duties and liabilities;

(6) The appointment of a special master commissioner to hear and determine any matters with the authority that the court considers proper;

(7) The filling of any vacancies in the number of managers or liquidators if the managers are unable to act on the vacancies for want of a quorum or for any other reason;

(8) The appointment of a receiver, in accordance with the usages of a court in equitable matters, to wind up the affairs of the association, to take custody of any of its property, or for any other purpose;

(9) The issuance or entry of any injunction or any other order that the court considers proper in the administration of the trust involved in the winding up of the affairs of the association and the giving of notice of it;

(10) The allowance and payment of compensation to the managers or any of them, to liquidators, to a receiver, to the attorney for the complainant, or to any person properly rendering services beneficial to the association or to those interested in it;

(11) The entry of a judgment or decree that, if it so provides, may operate as the deed or other instrument ordered to be executed, or the appointment of a master to execute that deed or instrument in the name of the association with the same effect as if executed by an authorized manager pursuant to authority conferred by the managers or by the members of the association if there is no manager competent to execute the deed or instrument, if the association or its managers do not perform or comply with a judgment or decree of court, or if the court considers it proper.

(B) A judicial proceeding under this section concerning the winding up of the affairs of an unincorporated nonprofit association is a special proceeding, and final orders in the proceeding may be vacated, modified, or reversed on appeal pursuant to the Rules of Appellate Procedure and, to the extent not in conflict with those rules, Chapter 2505. of the Revised Code.

Section 1745.54 | Receiver for winding up affairs of association.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) If after an unincorporated nonprofit association is dissolved voluntarily or the period of existence of the association has expired a receiver is appointed to wind up the affairs of the association, all of the claims, demands, rights, interests, or liens of creditors, claimants, and members shall be determined as of the day on which the receiver was appointed. Unless it is otherwise ordered, that appointment vests in the receiver and the receiver's successors the right to the immediate possession of all of the property of the association that shall, if so ordered, execute and deliver conveyances of the property to the receiver or the receiver's nominee.

(B) Any manager, member, or other person, whether a resident or nonresident of this state and however interested, may be appointed as receiver.

(C) The receiver has all the authority vested in the managers and members of the association, shall exercise that authority subject to the orders that are made by the court, and may be required to qualify by giving bond to the state in the amount that the court fixes, with surety to the satisfaction of the clerk of the court, conditioned for the faithful discharge of the receiver's duties and for a due accounting for all money or property received by the receiver.

Section 1745.55 | Judicial dissolution.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) An unincorporated nonprofit association may be dissolved judicially and its affairs wound up in any of the following manners:

(1) By an order of the supreme court or of a court of appeals in an action in quo warranto brought as provided by sections 2733.02 to 2733.39 of the Revised Code, in which event the court may order the affairs of the association to be wound up by its managers as in the case of voluntary dissolution or by proceedings in, and under the order of, the court of common pleas of the county in this state in which the association has its principal office;

(2) By an order of the court of common pleas of the county in this state in which that association has its principal office, in an action brought by members entitled to dissolve the association voluntarily, if any of the following is established:

(a) The association's period of existence as set forth in its governing principles has expired, and it is necessary in order to protect the members that the association be judicially dissolved.

(b) The association is insolvent or is unable to afford reasonable security to those who may deal with it, and it is necessary in order to protect the creditors of the association that the association be judicially dissolved.

(c) The objects of the association have wholly failed or are entirely abandoned, or their accomplishment is impracticable.

(3) By an order of the court of common pleas of the county in this state in which the association has its principal office, in an action brought by a majority of the voting members or by any lesser proportion or number of members that are entitled by the governing principles to dissolve the association voluntarily, if it is established that it is beneficial to the members that the association be judicially dissolved;

(4) By an order of the court of common pleas of the county in this state in which the association has its principal office, in an action brought by one-half of the managers if there is an even number of managers or by one-half of the members if it is established that the association has an even number of managers who are deadlocked in the management of the association's affairs, and the members are unable to break the deadlock, or if it is established that the association has an uneven number of managers, and the members are deadlocked in voting power and unable to agree upon or vote for the election of managers as successors to managers whose terms normally would expire upon the election of their successors.

(B) A complaint for judicial dissolution shall be verified by any of the complainants and shall set forth facts showing that the case is one of those specified in this section. Unless the complainants set forth in the complaint that they are unable to annex a list of members, a schedule shall be annexed to the complaint setting forth the name of each member and the member's address if it is known.

(C) Upon the filing of a complaint for judicial dissolution, the court with which it is filed shall have the power to issue injunctions, to appoint a receiver with the authority and duties that the court from time to time may direct, to take any other proceedings that may be necessary to protect the property or the rights of the complainants or of the persons interested, and to carry on the activities of the unincorporated nonprofit association until a full hearing can be had. Upon or after the filing of a complaint for judicial dissolution, the court by injunction or order may stay the prosecution of any proceeding against the unincorporated nonprofit association or involving any of its property and require the parties to it to present and prove their claims, demands, rights, interests, or liens at the time and in the manner required of creditors or others. The court may refer the complaint to a special master commissioner.

(D) After a hearing had upon the notice that the court may direct to be given to all parties to the proceeding and to any other parties in interest designated by the court, a final order based either upon the evidence or upon the report of the special master commissioner if one has been appointed, shall be made dissolving the association or dismissing the complaint. An order or judgment for the judicial dissolution of an unincorporated nonprofit association shall contain a concise statement of the proceedings leading up to the order or judgment, the name of the association, the place in this state where its principal office is located, the names and addresses of its managers, the name and address of a statutory agent, and if desired, any other provisions with respect to the judicial dissolution and winding up of affairs that are considered necessary or desirable. Upon the issuance of that order or judgment, the association shall be dissolved. To the extent consistent with orders entered in that proceeding, the effect of the judicial dissolution shall be the same as in the case of voluntary dissolution, and the provisions of sections 1745.52, 1745.53, and 1745.54 of the Revised Code with respect to the authority and duties of managers during the winding up of the affairs of an association dissolved voluntarily, the jurisdiction of courts over the winding up of the affairs of an association, and receivers for winding up the affairs of an association are applicable to associations that are judicially dissolved. If a statement is on file with the secretary of state appointing an agent authorized to receive service of process on the association, or if any other document is on file with the secretary of state with respect to the association, a certified copy of any order or judgment dissolving the association shall be filed with the secretary of state.

(E) A judicial proceeding under this section concerning the judicial dissolution of an unincorporated nonprofit association is a special proceeding, and final orders in the proceeding may be vacated, modified, or reversed on appeal pursuant to the Rules of Appellate Procedure or the Rules of Practice of the Supreme Court, whichever are applicable, and, to the extent not in conflict with those rules, Chapter 2505. of the Revised Code.

Section 1745.56 | Liability of managers and members.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

(A) The members, the managers, and the officers of an unincorporated nonprofit association shall not be personally liable for any obligation of the association.

(B)(1) Managers who vote for or assent to any of the following shall be jointly and severally liable to the association as provided in division (B)(2) of this section:

(a) A distribution of assets to members contrary to law or the governing principles;

(b) A distribution of assets to persons other than creditors during the winding up of the affairs of the association on dissolution or otherwise without the payment of all known obligations of the association or without making adequate provision for that payment;

(c) The making of loans, other than in the usual conduct of its affairs or in accordance with provisions for the making of loans in the governing principles, to an officer, manager, or member of the association.

(2) The managers described in division (B)(1) of this section shall be jointly and severally liable to the association as follows:

(a) In cases under division (B)(1)(a) of this section, except as provided in division (B)(3) of this section, up to the amount of the distribution in excess of the amount that could have been distributed without violation of law or the governing principles but not in excess of the amount that would inure to the benefit of the creditors of the association if it was insolvent at the time of the distribution or there was reasonable ground to believe that by that action it would be rendered insolvent, or to the benefit of the members other than members of the class in respect of which the distribution was made;

(b) In cases under division (B)(1)(b) of this section, except as provided in division (B)(3) of this section, to the extent that those obligations that are not otherwise barred by statute are not paid or for the payment of which adequate provision has not been made;

(c) In cases under division (B)(1)(c) of this section, for the amount of the loan with interest at the rate of six per cent per annum until that amount has been paid.

(3) A manager shall not be liable under division (B)(1)(a) or (b) of this section if in determining the amount available for any distribution under that division, the manager in good faith relied on a financial statement of the association prepared by an officer or employee of the association in charge of its accounts or certified by a public accountant or firm of public accountants, in good faith considered the assets to be of their book value, or followed what the manager believed to be sound accounting and business practice.

(C) A manager who is present at a meeting of the managers or of a committee of the managers at which action on any matter is authorized or taken and who has not voted for or against that action shall be presumed to have voted for the action unless the manager's written dissent from the action is filed either during the meeting or within a reasonable time after the adjournment of the meeting, with the person acting as secretary of the meeting or with the secretary of the association.

(D) A member who knowingly receives any distribution made contrary to law or the governing principles shall be liable to the association for the amount received by the member that is in excess of the amount that could have been distributed without violation of law or the governing principles.

(E) A manager against whom a claim is asserted under or pursuant to this section and who is held liable on the claim shall be entitled to contribution, on equitable principles, from other managers who are also liable. Additionally, any manager against whom a claim is asserted under or pursuant to this section or who is held liable on the claim shall have a right of contribution from the members who knowingly received any distribution made contrary to law or the governing principles, and those members as among themselves shall also be entitled to contribution in proportion to the amounts received by them respectively.

(F) No action shall be brought by or on behalf of an association upon any cause of action arising under division (B)(1)(a) or (b) of this section at any time after two years from the day on which the violation occurs.

(G) Nothing in this section shall preclude any creditor whose claim is unpaid from exercising any rights that the creditor otherwise would have by law to enforce the creditor's claim against the assets of the association distributed to the members or other persons.

Section 1745.57 | Savings clause.

• Effective: May 22, 2012
• Latest Legislation: House Bill 267 - 129th General Assembly

Sections 1745.05 to 1745.56 of the Revised Code do not affect any action or proceeding that is commenced, or any right that accrues, before those sections take effect.