The Honorable Kevin Smith State Senator 1609 Coker-Hampton Drive Stuttgart, AR 72160
Dear Senator Smith:
This is in response to your request for an opinion regarding a contract between two non-profit corporations. You have posed the following specific questions:
1. Can a contract between 501-C-3 organizations on behalf of an ad hoc committee legally allow that committee to override the procedures of the nonprofit that is the depositor of the funds?
2. If yes, is the nonprofit that is the depositor of the funds free of liability if it merely complies with whatever the steering committee's financial requests are?
3. If no, does the steering committee then have to recognize and follow the procedures established by the nonprofit in the disbursement of these funds?
4. Does an ad hoc committee with no organizational framework (i.e., by-laws, directors, officers, tax I.D. number) have any legal standing under Arkansas law?
I am unable to give an opinion on the first three of your questions. They are all matters governed by the contract in question, when analyzed in conjunction with the applicable governing corporate documents and procedures. Such an analysis is not within the scope of an attorney general opinion.
I am unable to give an opinion on your fourth question, because I have not been given sufficient information upon which to analyze the question. Unincorporated associations may have "legal standing" for certain purposes and under certain circumstances, such as those governed by a contract which grants such standing. Without more specific information regarding the ad hoc committee and the particular legal standing about which you are concerned, I cannot opine as to this matter.
The preceding discussion, which I hereby approve, was prepared by Assistant Attorney General Suzanne Antley.
Sincerely,
WINSTON BRYANT Attorney General
WB:SA/cyh