Spencer Fane LLP Logo

Drafting and Review of Bylaws

For new associations, one important task is to prepare the organization’s Constitution, operating bylaws or other governing regulations. This is an art (more than a science) meriting careful attention to competing interests and detail. Among other things, association rules need to provide sufficient notice of expectations to members without attempting to anticipate every potential scenario that may arise. Having said that, the rules need to be forward-thinking enough to apply for years into the future without the need for constant revisions. They need to match the member’s interests without compromising the legal position of the association itself, or its staff. The rules need to be clear about their origin, their purpose and their impact, if any, on non-members. The rules also need to comply with any applicable laws and, for tax exempt associations, clearly advance the functions to which the tax exemption is tied. These and other considerations make drafting the Constitution and bylaws an important challenge for any association.

For established associations, years often pass without meaningful review of governing constitutional or bylaw provisions. As daily practices of the association inevitably evolve, frequently the applicable bylaws do not. What follows is a dangerous discrepancy between the practical operations of an association and its written procedures. While all parties may appear to accept the difference between policy and practice in functional times, the departures become problematic when disputes arise. Rather than correcting dated bylaws after-the-fact, the far better practice is to update governing provisions contemporaneously . . . and in ways that advance the association’s legal position. We can help balance these interests while also incorporating the drafting strategies discussed above regarding rules of a newly-formed association.