President General Merry Ann T. Wright has posted a clarification regarding the bylaws amendment passed at Continental Congress. Please read this explanation carefully. This amendment was reported in the July 2012 Clarion.
President General’s Statement:
I hope you have received your copies of the Resolutions and the Bylaws amendments. Several have asked questions about what these recent Bylaw changes in Article XIII. Section 1 (b) and Article XV. Section 1 (b) mean for DAR Chapters and State Organizations (Societies).
During discussion last year with our legal advisors, it became evident that the National Society must be clear about what entity bears the responsibility for the actions or inactions taken by that entity and claims made against it. Thus, two changes to the Bylaws were proposed and passed by Continental Congress to clarify this issue. The amendments are not a change in how we operate but were made to ensure that all levels of NSDAR understand their responsibilities.
The changes are to add the (b) section in each case and those follow:
Article XIII – Section 1. (b) Such chapters, whether presently existing, in formation, or to be organized under this Article XIII, shall be independent legal entities from the National Society, and solely responsible in all instances, for their debts, legal obligations, liabilities, expenditures, claims made against them and any actions taken by them.
Article XV – Section 1 (b) Such state organizations, whether presently existing, in formation, or to be organized under this Article XV, shall be independent legal entities from the National Society, solely responsible in all instances, for their debts, legal obligations, liabilities, expenditures, claims made against them and any actions taken by them.
The key wording here is “shall be independent legal entities from the National Society, solely responsible in all instances, for their debts, legal obligations, liabilities, expenditures, claims made against them and any actions taken by them.”
This means that chapters and state organizations of DAR are responsible for their own business dealings and must meet those responsibilities in all cases. Chapters and state organizations must do such things as pay their own bills, carry their own insurance, if necessary; meet any legal obligations, file their IRS 990 forms and retain their own legal counsel if they require such counsel.
There have been cases where chapters have not met their obligations and the creditor has tried to force the state organization or the National Society to satisfy the obligation. In addition, many chapters and states have been under the misapprehension that the National Society carries insurance that will cover any liability of the chapter. This is not the case and never has been.
Currently we have over 60 chapters that have not filed their 990 forms for three years in succession. These chapters have lost their non-profit 501 (c) (3) exemption and can never be under the umbrella exemption of NSDAR again. They must now file on their own.
It is important to the National Society that we remain a cohesive, unified organization, yet legal and financial issues must be separated to place the responsibility on those who are making the decisions. These two amendments are intended to do that in order to keep our business affairs in proper order.
DAR President General | September 18, 2012 at 12:21 pm