Friendly Societies Act 1974

• Citation: 1974 c. 46
• Sections: 181

Section 7 Societies which may be registered.

(1) Subject to subsections (2) and (3) below and also to section 9 below, the following societies may remain registered under this Act, that is to say,—

(a) societies (in this Act called “ friendly societies ”) for the purpose of providing by voluntary subscriptions of the members, with or without the aid of donations, for any purpose falling within Schedule 2 to the 1992 Act ;

(b) societies (in this Act called “ cattle insurance societies ”) for the purpose of insurance to any amount against loss of cattle, sheep, lambs, swine, horses, and other animals by death from disease or otherwise;

(c) societies (in this Act called “benevolent societies”) for any benevolent or charitable purpose;

(d) societies (in this Act called “working men’s clubs”) for purposes of social intercourse, mutual helpfulness, mental and moral improvement and rational recreation;

(e) societies (in this Act called “ old people’s home societies ”) for the purpose of providing homes for the members and others at any age after fifty;

(f) societies (in this Act called “specially authorised societies”) for any purpose which the Treasury may authorise as a purpose to which the provisions of this Act, or such of them as are specified in the authority, ought to be extended but no society may become registered under this Act after the commencement of section 93 of the 1992 Act.

(2) A society may not be registered under this Act unless—

(a) the rules of the society contain provisions in respect of the several matters mentioned in Part I of Schedule 2 to this Act and, in the case of a friendly society or cattle insurance society, also contain provisions in respect of the several matters mentioned in Part II of that Schedule; and

(b) the place which under the society’s rules is to be the society’s registered office is situated in the United Kingdom, the Channel Islands or the Isle of Man ; and

(c) the society consists of at least seven persons.

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(4) Where any provisions of this Act are specified in an authority given under paragraph (f) of subsection (1) above, those provisions only shall extend to a society which has been registered as a specially authorised society by virtue of that authority.

(5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Section 9 Special provisions as to dividing societies and societies assuring annuities.

(1) A society which is neither a benevolent society nor a working men’s club shall not be disentitled to registration by reason of any rule for, or practice of, dividing any part of the funds thereof, if the rules of the society contain distinct provision for meeting all claims upon the society existing at the time of the division before any such division takes place.

(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Section 11 Additional requirements for registration of societies with branches.

(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(2) A society having a fund under the control of a central body to which every branch is bound to contribute may be registered as a single society, . . ..

Section 12 Establishment of new branches.

(1) There shall be sent to the FCA , under the hand of the secretary of a registered society,—

(a) notice of the establishment of every new branch of the society;

(b) notice of the place where the registered office of the branch, to which all communications and notices may be addressed, is to be situated;

(c) if the branch is to have trustees or officers authorised to sue and be sued on its behalf, other than the trustees or officers authorised to sue and be sued on behalf of the society, a list of the names of those trustees or officers; and

(d) two copies of the rules of the branch.

(2) A society shall not be entitled to any of the privileges of this Act as a registered society with respect to a branch until the branch has been registered . . ..

Section 13 Registration of branches as societies.

(1) A body which has been registered as a branch of a society shall not be registered as a society after the commencement of section 93 of the 1992 Act .

(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Section 14 Name of seceding or expelled branch.

A body which, having been a branch of a society, has wholly seceded or been expelled from that society, shall not thereafter use the name of that society or any name implying that it is a branch thereof, or the number by which it was designated as such a branch.

Section 15A Acknowledgement of registration and rules of new branch.

(1) On being satisfied that a branch has complied with the provisions of this Act as to registration, the FCA shall issue to that branch an acknowledgement of registration.

(2) An acknowledgement under subsection (1) above shall be conclusive evidence that the branch in question is duly registered under this Act, unless it is proved that the registration of the society of which it is a branch has been suspended or cancelled.

(3) An acknowledgement under subsection (1) above shall also constitute an acknowledgement, and be conclusive evidence, of the rules of the branch in force at the date of its registration.

Section 16 Appeals from refusal to register.

(1) If the FCA refuses to register a branch, the branch may appeal to the High Court or, in the case of a branch whose registered office is to be situated in Scotland, the Court of Session.

(2) If a refusal to register a . . . branch is overruled on appeal, the FCA shall give an acknowledgment of registration under section 15A above to the . . . branch.

Section 18 Registration of amendments of rules of society or branch.

(1) Subject to subsection (2) below, any amendment of the rules of a society or branch as for the time being registered under this Act shall not be valid until the amendment has been so registered, and for this purpose copies of the amendment, signed by three members and the secretary of the society or of the branch, as the case may be, shall be sent to the FCA .

(2) Subsection (1) above shall not apply to a change in the situation of the registered office of a society or branch, but—

(a) notice of any change in the situation of the registered office of a society or branch shall be sent to the FCA and, in the case of a change in the situation of the registered office of a branch, shall be sent to the FCA through an officer appointed in that behalf by the society of which the branch forms part; and

(b) where notice of such a change is sent to the FCA under paragraph (a) above, the FCA shall register it as an amendment of the rules of the society or branch concerned.

Section 19 Acknowledgment of registration of amendments of rules.

On being satisfied that any amendment of the registered rules of a society or branch is not contrary to the provisions of this Act, the FCA shall issue to the society or branch, in respect of that amendment, an acknowledgment of registration which shall be conclusive evidence that the amendment is duly registered.

Section 20 Appeals from refusal to register amendment of rule.

(1) If the FCA refuses to register an amendment of a rule of a registered society or branch, the society or branch may appeal to the High Court or, in the case of a society or branch whose registered office is situated in Scotland, the Court of Session.

(2) If a refusal to register an amendment of a rule is over-ruled on appeal, the FCA shall give an acknowledgment of registration under section 19 above to the society or branch.

Section 21 Duty to supply copies of rules.

Every registered society or branch shall deliver to any person on demand, on payment of a reasonable fee , a copy of the rules of the society or branch.

Section 22 Rules of certain registered societies to bind members at law.

(1) The rules of—

(a) a registered cattle insurance society or branch, and

(b) such specially authorised societies or branches thereof as the Treasury may allow to take the benefit of this section,

shall bind the society or branch and the members thereof, and all persons claiming through them, to the same extent as if each member had subscribed his name and affixed his seal hereto, and as if there were contained in the rules a covenant on the part of himself and his executors or administrators to conform to the rules subject to the provisions of this Act.

(2) All sums of money payable by a member to a society or branch falling within subsection (1) above shall be deemed to be a debt due from the member to the society or branch and shall be recoverable as such in the county court for the district in which the member resides.

(2A) In the application of subsection (2) to England and Wales, for the words “for the district in which the member resides” there shall be substituted “if the member resides in England and Wales”.

(3) In the application of this section to Scotland, in subsection (1) the words “ and affixed his seal ” shall be omitted, and in subsection (2) for the words “in the county court for the district” there shall be substituted the words “ before the sheriff of the sheriffdom ” .

Section 23 Special provisions which may be included in rules.

(1) The rules of a registered society or branch may provide for the reinsurance, to such extent as may from time to time be approved by a qualified actuary, of risks of any class against which persons are, or are to be, insured by that society or branch.

(2) The rules of a registered society which is a specially authorised society complying with the provisions of subsection (3) below may provide that it may receive deposits and borrow money at interest from its members or from other persons, and upon the registration of such a rule the same shall be valid.

(3) A specially authorised society complies with the provisions of this subsection if it has for its object the creation of funds to be lent out to the members of the society or for their benefit, and has in its rules provisions—

(a) that no part of its funds shall be divided by way of profit, bonus, dividend or otherwise among its members; and

(b) that all money lent to members shall be applied to such purpose as the society or its committee may approve.

Section 24 Trustees of registered societies and branches.

(1) Every registered society and branch shall have one or more trustees.

(2) The trustees may be appointed—

(a) by a resolution of the society or branch in general meeting; or

(b) in such other manner as the rules of the society or branch may provide.

(3) If a trustee is appointed under subsection (2)(a) above, the society or branch shall send to the FCA a copy of the resolution appointing him, signed by the trustee so appointed and by the secretary of the society or branch.

(4) If a trustee is appointed under subsection (2)(b) above, the society or branch shall send to the FCA —

(a) notice of his appointment signed by the secretary of the society or branch; and

(b) an acceptance of office signed by the trustee so appointed.

(5) In the case of the appointment of a trustee of a branch, any document referred to in subsection (3) or (4) above shall be sent to the FCA through an officer appointed in that behalf by the society of which the branch forms part.

(6) The same person may not be a secretary or treasurer of a registered society or branch and also a trustee of that society or branch.

Section 25 Minors not to hold office.

A minor shall not be a member of the committee, or a trustee, manager or treasurer, of a registered society or branch.

Section 26 Proof of appointment of officers and trustees.

If any such list as is referred to in section 12(1)(c) above is signed—

(a) by every trustee and other officer named in the list; and

(b) by the secretary of the branch,

then on the registration of the branch the list shall be evidence that the persons so named have been duly appointed.

Section 29 Books of account, etc.

(1) Every registered society and branch shall—

(a) cause to be kept proper books of account with respect to its transactions and its assets and liabilities, and

(b) establish and maintain a satisfactory system of control of its books of account, its cash holdings and all its receipts and remittances.

(2) For the purposes of subsection (1)(a) above, proper books of account shall not be taken to be kept with respect to the matters mentioned in that paragraph unless there are kept such books as are necessary to give a true and fair view of the state of the affairs of the society or branch and to explain its transactions.

(3) Any book of account to be kept by a registered society or branch may be kept either by making entries in bound books or by recording the matters in question in any other manner.

(4) Where any such book of account is not kept by making entries in a bound book but by some other means, the society or branch shall take adequate precautions for guarding against falsification and for facilitating its discovery.

Section 30 General provisions as to accounts and balance sheets.

(1) Every revenue account of a registered society or branch shall give a true and fair view—

(a) if it deals with the affairs of the society or branch as a whole, of the income and expenditure of the society or branch as a whole for the period to which the account relates; and

(b) if it deals with a particular business conducted by the society or branch, of the income and expenditure of the society or branch in respect of that business for the period to which the account relates.

(2) Every registered society or branch shall, in respect of each year of account, cause to be prepared either—

(a) a revenue account which deals with the affairs of the society or branch as a whole for that year; or

(b) two or more revenue accounts for that year which deal separately with the particular businesses conducted by the society or branch.

(3) In a case falling within subsection (2)(b) above, without prejudice to the application of subsection (1)(b) above to each revenue account dealing with a particular business conducted by a society or branch, the revenue accounts in question, when considered together, shall give a true and fair view of the income and expenditure of the society or branch as a whole for the year of account to which they relate.

(4) Subject to subsection (5) below, every balance sheet of a registered society or branch shall give a true and fair view, as at the date of the balance sheet, of the state of the affairs of the society or branch.

(5) Subsection (4) above does not apply in the case of—

(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b) a specially authorised society or branch which, by virtue of a direction in the authority for registering that society or branch, is required to carry out a valuation under section 41 below,

but every balance sheet of a society or branch falling within . . . paragraph (b) above shall give a true and fair view, as at the date of the balance sheet, of the assets and current liabilities of the society or branch and the resulting balances of its funds.

(6) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(7) Without prejudice to the provisions of subsection (6) above, a registered society or branch falling within paragraph (a) or paragraph (b) of subsection (5) above shall not publish any balance sheet which does not include a statement containing the same particulars as the statement required to be included in the annual return of that society or branch by section 43(5) below.

(8) If in relation to any revenue account, revenue accounts or balance sheet of a registered society or branch, a member of the committee thereof fails to take all reasonable steps to secure compliance—

(a) with subsection (1), subsection (4) or, as the case may require, subsection (5) above, or

(b) in a case falling within subsection (2)(b) above, with subsection (3) above,

he shall be liable on summary conviction to a fine not exceeding level 5 on the standard scale unless he proves that he had reasonable grounds to believe, and did believe, that a competent and reliable person was charged with the duty of seeing that the relevant provision was complied with and was in a position to discharge that duty.

Section 30A Publication of accounts and balance sheets.

(1) A registered society or branch shall not publish any revenue account or balance sheet unless it has been signed by the secretary of the society or branch and by two members of its committee acting on the committee’s behalf.

(2) Where at the end of a registered society’s or branch’s year of account no disapplication under section 32A(1) below is in force in relation to the year, the society or branch shall not publish a year end revenue account or balance sheet unless—

(a) it has been previously audited by the auditor or auditors last appointed to audit the accounts and balance sheet of the society or branch, and

(b) it incorporates a report by the auditor or auditors stating whether in their opinion it complies with subsection (1), (4) or, as the case may be, (5) of section 30 above.

(3) Where at the end of a registered society’s or branch’s year of account a disapplication under section 32A(1) below is in force in relation to the year and the society’s or branch’s turnover in the preceding year of account exceeded £90,000, the society or branch shall not publish a year end revenue account or balance sheet unless—

(a) it is one on which the society or branch has obtained from a person appointed under subsection (2) of section 39A below a report which meets the requirements of subsection (3) of that section, and

(b) it incorporates so much of the report as relates to it.

(4) Where at the beginning of a year of account (in this subsection referred to as “the current year of account” a registered society or branch is subject to subsection (2) above in relation to the publication of a year end revenue account or balance sheet for the preceding year of account, it shall not publish any interim revenue account or balance sheet for the current year of account—

(a) if a disapplication under section 32A(1) below is in force in relation to that year, unless it incorporates a report by an appropriate person stating whether in his opinion it complies with subsection (1), (3) or, as the case may be, (5) of section 30 above, and

(b) if no disapplication under section 32A(1) below is in force in relation to that year, unless paragraphs (a) and (b) of subsection (2) above are met in relation to it.

(5) Where at the beginning of a year of account (in this subsection referred to as “the current year of account”) a registered society or branch is subject to subsection (3) above in relation to the publication of a year end revenue account or balance sheet for the preceding year of account, it shall not publish any interim revenue account or balance sheet for the current year of account unless it incorporates a report by an appropriate person stating—

(a) whether, in his opinion, the revenue account, or, as the case may be, the balance sheet, is in agreement with the books of account kept by the society or branch under section 29 above, and

(b) whether, in his opinion, on the basis of the information contained in those books of account, the revenue account or, as the case may be, the balance sheet complies with the requirements of this Act.

(6) Where a registered society’s or branch’s year of account is one in relation to which a direction under section 39C below has effect, the society or branch shall not publish any year end or interim revenue account or balance sheet, unless it incorporates a report by the auditor or auditors appointed in pursuance of the direction stating whether in their opinion it complies with subsection (1), (3) or, as the case may be, (5) of section 30 above.

(7) Subsection (3) above shall cease to apply in relation to a year of account if a direction under section 39C below is made in relation to it.

(8) Section 39B below shall apply in relation to a person appointed for the purposes of subsection (4) or (5) above as it applies in relation to a person appointed under section 39A(2) below.

(9) In subsection (4) above, references to a disapplication under section 32A(1) below being in force in relation to a year of account shall, where the year of account has ended, be construed as references to a disapplication under that provision being in force at the end of the year.

(10) Subject to subsection (11) below, in subsections (4) and (5) above, references to an appropriate person are to a person who is—

(a) a qualified auditor for the purposes of this Act, and

(b) not ineligible by virtue of section 37(1) below to be appointed as auditor of the society or branch.

(11) In relation to the application of subsection (4) above to a registered society or branch which—

(a) was an exempt society or an exempt branch in respect of the preceding year of account, and

(b) appointed persons who were not qualified auditors to audit its accounts and balance sheet for that year,

subsection (10) above shall, if the year is not one in relation to which the appropriate authority has given a direction under section 32(2) below, have effect with the omission of paragraph (a).

(12) In this section—

“ interim balance sheet ”, in relation to a year of account, means a balance sheet relating to the position at a time in the year other than the end;

“ interim revenue account ”, in relation to a year of account, means a revenue account for any period falling within the year of account, other than one ending at the end of the year;

“turnover” has the same meaning as in section 32A below;

“ year end balance sheet ”, in relation to a year of account, means a balance sheet relating to the position at the end of the year; and

“ year end revenue account ”, in relation to a year of account, means a revenue account for the year or for any period falling within the year of account and ending at the end of the year.

Section 31 Obligation to appoint auditors.

(1) Subject to the following provisions of this section and section 32A(1) below , every registered society and branch shall, in each year of account, appoint a qualified auditor or qualified auditors to audit its accounts and balance sheet for that year.

(2) Subsection (1) above shall not apply to a society or branch . . . if—

(a) the receipts and payments of that society or branch in respect of the preceding year of account did not, in the aggregate, exceed £5,000; and

(b) the number of its members at the end of that year did not exceed 500; and

(c) the value of its assets at the end of that year did not, in the aggregate, exceed £5,000.

(3) Without prejudice to subsection (2) above, subsection (1) above shall not apply to a registered branch if—

(a) the conditions specified in paragraphs (a) and (b) of subsection (2) above are satisfied in respect of that branch; and

(b) at the end of the preceding year of account at least 75% of its assets had been transferred to the society of which it is a branch or to another registered branch of that society for the purpose of being invested, in accordance with section 46(2) below, by that society or other branch, and the value of its assets not so transferred did not, in the aggregate, exceed £5,000; and

(c) the society or branch to which the assets were transferred is one to which subsection (1) above applies in the year of account in question.

(4) A registered society or branch to which, by virtue of subsection (2) or subsection (3) above, subsection (1) above does not apply in respect of any year of account is in this Act referred to as an exempt society or, as the case may be, an exempt branch, in respect of that year of account.

(5) Regulations made by the Treasury , may—

(a) substitute for any sum or number for the time being specified in subsection (2) above, or for any sum or percentage for the time being specified in subsection (3) above, such sum, number or percentage as may be specified in the regulations; and

(b) prescribe what receipts and payments of a society shall be taken into account for the purposes of those subsections;

and any such regulations may make different provision in relation to different cases or different circumstances.

Section 32 Audit of exempt societies and branches.

(1) Subject to any direction given by the appropriate authority under subsection (2) below, every registered society or branch which is an exempt society or an exempt branch in respect of the current year of account shall in that year appoint at its option either—

(a) a qualified auditor or qualified auditors, or

(b) two or more persons who are not qualified auditors,

to audit its accounts and balance sheet for that year.

(2) The appropriate authority may give a direction in the case of any particular society or branch which is an exempt society or branch in respect of the current year of account requiring it to appoint a qualified auditor to audit its accounts and balance sheet for that year.

(3) The appropriate authority may give a direction in the case of any particular society or branch which was an exempt society or branch in respect of any year of account before that in which the direction is given and did not appoint a qualified auditor or qualified auditors to audit its accounts and balance sheet for that year—

(a) requiring it to appoint a qualified auditor to audit those accounts and that balance sheet, and

(b) in a case where that society or branch has sent to the appropriate authority its annual return for that year before the date of the direction, requiring it, after its accounts and balance sheet have been audited by a qualified auditor, to send to the appropriate authority within three months from receipt of the direction a further annual return complying with the requirements of this Act (other than the requirement as to the time at which the annual return must be sent).

(4) A failure by a registered society or branch to comply with any direction given by the appropriate authority under this section shall be an offence under this Act.

Section 32A Power of societies to disapply section 31.

(1) Subject to subsections (3) and (4) below, a registered society or branch may disapply section 31 above in relation to a year of account beginning on or after the day on which the Deregulation (Industrial and Provident Societies) Order 1996 comes into force if—

(a) the value of its assets at the end of the preceding year of account did not in the aggregate exceed £1,400,000, and

(b) its turnover for that year did not exceed £350,000.

(2) The power conferred by subsection (1) above shall be exercisable by resolution passed at a general meeting of the society or branch at which—

(a) less than 20 per cent. of the total votes cast are cast against the resolution, and

(b) less than 10 per cent. of the members of the society or branch for the time being entitled under the body’s rules to vote cast their votes against the resolution.

(3) Subsection (1) above shall not apply to a society or branch which holds, or has, at any time since the end of the preceding year of account, held, a deposit . . ..

(3A) In subsection (3) the reference to a deposit must be read with—

(a) section 22 of the Financial Services and Markets Act 2000;

(b) any relevant order under that section;

(c) Schedule 2 to that Act.

(4) The appropriate authority may by notice to a society or branch disapply subsection (1) above in relation to the year of account of the society or branch in which the notice is given.

(5) Where a society or branch exercises the power conferred by subsection (1) above, the disapplication shall cease to have effect if at any time before the end of the year of account to which it relates—

(a) the society or branch becomes one to which subsection (3) above applies, or

(b) the appropriate authority gives to the society or branch notice under subsection (4) above.

(6) In the case of a society or branch which is a charity as defined by section 1(1) of the Charities Act 2011, a recognised body as defined by section 1(7) of the Law Reform (Miscellaneous Provisions) (Scotland) Act 1990 or a charity within the meaning of the Charities Act (Northern Ireland) 1964 subsection (1) above shall have effect with the substitution for paragraph (b) of—

(b) its gross income for that year did not exceed £250,000.

(7) For a period which is a society’s or branch’s year of account, but not in fact a year, the maximum figure in subsection (1)(b) above (including that provision as it has effect by virtue of subsection(6) above) shall be proportionately adjusted.

(8) In this section, “ turnover ”, in relation to a society or branch, means the amounts derived from the provision of goods and services falling within the society’s or branch’s activities, after deduction of—

(a) trade discounts,

(b) value added tax, and

(c) any other taxes based on the amounts so derived.

Section 33 Re-appointment and removal of auditors.

(1) A qualified auditor appointed to audit the accounts and balance sheet of a registered society or branch for the preceding year of account shall be reappointed as auditor of the society for the current year of account unless—

(a) a resolution has been passed at a general meeting of the society or branch appointing somebody instead of him or providing expressly that he shall not be reappointed; or or disapplying section 31 above in relation to the current year of account

(b) he has given to the society or branch notice in writing of his unwillingness to be reappointed; or

(c) he is ineligible for appointment as auditor of the society or branch for the current year of account; or

(d) he has ceased to act as auditor of the society or branch by reason of death or incapacity.

(2) Where notice is given of an intended resolution to appoint at a general meeting some person or persons in place of a retiring auditor and the resolution cannot be proceeded with at the meeting because of the death or incapacity of that person or persons, or because he or they are ineligible for appointment as auditor or auditors of the society or branch for the current year of account (as the case may be), the retiring auditor shall not be automatically reappointed by virtue of subsection (1) above.

(3) For the purposes of this section, a person is ineligible for appointment as auditor of a registered society or branch for the current year of account if, but only if,—

(a) his appointment in relation to the society or branch is prohibited by section 37 below, or

(b) (in the case of a society or branch which is not an exempt society or branch in respect of that year of account) he is not a qualified auditor at the time when the question of his appointment falls to be considered.

Section 34 Notice of resolutions relating to appointment and removal of auditors.

(1) A resolution at a general meeting of a registered society or branch—

(a) appointing another person as auditor in place of a retiring qualified auditor, or

(b) providing expressly that a retiring qualified auditor shall not be reappointed,

shall not be effective unless notice of the intention to move the resolution has been given to the society or branch not less than twenty-eight days before the meeting at which it is moved.

(2) Where notice of the intention to move any such resolution has been given under subsection (1) above to a society or branch which is required by its rules to give notice to its members of the meeting at which the resolution is to be moved, the society or branch shall, if it is practical to do so, give them notice of the resolution at the same time and in the same manner as it gives notice of the meeting.

(3) Where notice of the intention to move any such resolution has been given to a registered society or branch under subsection (1) above, and that society or branch does not give notice of the resolution under subsection (2) above, it shall give notice of the resolution to its members not less than fourteen days before the meeting at which the resolution is to be moved either by advertisement in a newspaper having an appropriate circulation or in any other way allowed by the rules of the society or branch.

(4) Where—

(a) for any of the reasons mentioned in section 33(2) above, an intended resolution to appoint some person or persons in place of a retiring qualified auditor cannot be proceeded with at the meeting, and

(b) by the rules of the registered society or branch an auditor can only be appointed by a resolution passed at a general meeting after notice of the intended resolution has been given to the society or branch before the meeting;

a resolution passed at that meeting reappointing the retiring auditor or appointing an auditor in place of the retiring auditor shall be effective notwithstanding that no notice of that resolution has been given to the society or branch under its rules.

(5) Any provision in this section which requires notice to be given to the members of a society or branch shall be construed, in the case of a meeting of delegates appointed by members, as requiring the notice to be given to the delegates so appointed.

Section 35 Proceedings subsequent to receipt of notice under s. 34.

(1) On receipt by a registered society or branch of notice given under section 34(1) above, the society or branch shall forthwith send a copy of the notice to the retiring auditor.

(2) On receipt of a copy of such a notice, the retiring auditor may at any time before the date of the general meeting make representations in writing to the society or branch (not exceeding a reasonable length) with respect to the intended resolution, and, without prejudice to the preceding provision, the retiring auditor may—

(a) notify the society or branch that he intends to make such representations; and

(b) request that notice of his intention, or of any such representations made by him and received by the society or branch before notice of the intended resolution is given to its members, shall be given to members of the society or branch.

(3) Subject to subsection (4) below, a society or branch which receives representations or a notification of intended representations under subsection (2) above before the date when notice of the intended resolution is required by subsection (2) or (as the case may be) subsection (3) of section 34 above to be given to its members shall—

(a) in any notice of the resolution given to its members, state that it has received those representations or that notification (as the case may be),

(b) in any such notice, state that any member may receive on demand made before the date of the general meeting a copy of any representations which have been or may be received by the society or branch before that date, and

(c) send a copy of any representations received by the society or branch before the date of the meeting to any member on demand made before that date;

but without prejudice either to the preceding provisions of this subsection or to his right to be heard orally, the retiring auditor may also require that any representations made by him before the date of the general meeting shall be read out at the meeting.

(4) Copies of any such representations need not be sent out, and the representations need not be read out at the meeting, if, on the application either of the society or branch or of any other person, the High Court is satisfied that the rights conferred by this section are being abused to secure needless publicity for defamatory matter; and the court may order the costs of the society or branch on an application under this section to be paid, in whole or in part, by the auditor, notwithstanding that he is not a party to the application.

(5) In the application of subsection (4) above to a society or branch whose registered office is situated in Scotland, for the reference to the High Court there shall be substituted a reference to the Court of Session and for the reference to costs there shall be substituted a reference to expenses.

(5A) In the application of subsection (4) above to a society whose registered office is in Northern Ireland, the reference to the High Court shall be construed as a reference to the High Court in Northern Ireland.

(6) Any provision in this section which requires notice to be given to the members of a society or branch or confers any right upon a member (as the case may be) shall be construed, in the case of a meeting of delegates appointed by members, as requiring a notice to be given to the delegates so appointed or as conferring the right upon a delegate (as the case may be).

Section 36 Qualified auditors.

(1) Subject to subsection (2) below, no person shall be a qualified auditor for the purposes of this Act unless he is eligible for appointment as a statutory auditor under Part 42 of the Companies Act 2006 .

(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Section 37 Restrictions on appointment of auditors.

(1) None of the following persons may be appointed as auditor of a registered society or branch, that is to say,—

(a) an officer or servant of the society or branch; or

(b) a person who is a partner of, or in the employment of, or who employs, an officer or servant of the society or branch; or

(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) Any appointment made by a registered society or branch in contravention of this section shall not be an effective appointment for the purposes of this Act.

(4) References in subsection (1) above to an officer or servant shall be construed as not including an auditor.

Section 38 Auditors’ report.

(1) The auditors of a registered society or branch shall make a report to the society or branch on the accounts examined by them and on the revenue account or accounts and the balance sheet of the society or branch for the year of account in respect of which they are appointed.

(2) The report shall state whether the revenue account or accounts and the balance sheet for that year comply with the requirements of this Act and whether, in the opinion of the auditors—

(a) the revenue account or accounts give a true and fair view, in accordance with section 30 above, of the income and expenditure of the society or branch as a whole for that year of account and, in the case of each such account which deals with a particular business conducted by the society or branch, a true and fair view in accordance with that section of the income and expenditure of the society or branch in respect of that business for that year; and

(b) the balance sheet gives a true and fair view, in accordance with that section, either of the state of the affairs of the society or branch or of the assets and current liabilities of the society or branch and the resulting balances of its funds (as the case may require) as at the end of that year of account.

(3) Without prejudice to the provisions of subsection (2) above, where the report of the auditors relates to any accounts other than the revenue account or accounts for the year of account in respect of which they are appointed, that report shall state whether those accounts give a true and fair view of any matter to which they relate.

(4) It shall be the duty of the auditors of a registered society or branch, in preparing their report under this section, to carry out such investigations as will enable them to form an opinion as to the following matters, that is to say,—

(a) whether the society or branch has kept proper books of account in accordance with the requirements of section 29(1)(a) above; and

(b) whether the society or branch has maintained a satisfactory system of control over its transactions in accordance with the requirements of section 29(1)(b) above; and

(c) whether the revenue account or accounts, the other accounts (if any) to which the report relates, and the balance sheet are in agreement with the books of account of the society or branch;

and if the auditors are of opinion that the society or branch has failed to comply with paragraph (a) or paragraph (b) of section 29(1) above, or if the revenue account or accounts, the other accounts (if any) and the balance sheet are not in agreement with the books of account of the society or branch, the auditors shall state that fact in their report.

(5) If the auditors fail to obtain all the information and explanations which, to the best of their knowledge and belief, are necessary for the purposes of their audit, they shall state that fact in their report.

Section 39 Auditors’ right of access to books and to attend and be heard at meetings.

(1) Every auditor of a registered society or branch—

(a) shall have a right of access at all times to the books, deeds and accounts of the society or branch and to all other documents relating to its affairs; and

(b) shall be entitled to require from the officers of the society or branch such information and explanations as he thinks necessary for the performance of the duties of the auditors.

(2) The auditors of a registered society or branch shall be entitled—

(a) to attend any general meeting of the society or branch, and to receive all notices of, and other communications relating to, any general meeting which any member of the society or branch is entitled to receive; and

(b) to be heard at any meeting which they attend on any part of the business of the meeting which concerns them as auditors.

Section 39A Duty to obtain accountant’s report where section 31 disapplied.

(1) Subsection (2) below applies where—

(a) at the end of a registered society’s or branch’s year of account a disapplication under section 32A(1) above is in force in relation to the year, and

(b) the society’s or branch’s turnover in the preceding year of account exceeded £90,000.

(2) The society or branch shall, before the end of the period of 28 days beginning immediately after the end of the year of account, appoint an appropriate person to make—

(a) a report on its accounts and balance sheet for the year which meets the requirements of subsection (3) below, and

(b) a report relating to the preceding year of account which meets the requirement of subsection (4) below.

(3) A report for the purposes of subsection (2)(a) above shall—

(a) state whether, in the opinion of the person making the report, the revenue account or accounts, the other accounts (if any) to which the report relates, and the balance sheet are in agreement with the books of account kept by the society or branch under section 29 above, and

(b) state whether, in that person’s opinion, on the basis of the information contained in those books of account, the revenue account or accounts and the balance sheet comply with the requirements of this Act.

(4) A report for the purposes of subsection (2)(b) above shall state whether in the opinion of the person making the report the financial criteria for the exercise of the power conferred by section 32A(1) above were met in relation to the year.

(5) In subsection (2) above, the reference to an appropriate person is to a person who is—

(a) a qualified auditor for the purposes of this Act, and

(b) not ineligible by virtue of section 37(1) above to be appointed as auditor of the society or branch.

(6) In this section, “turnover” has the same meaning as in section 32A above.

Section 39B Rights of person appointed under section 39A(2).

(1) A person appointed under section 39A(2) above shall, for the purposes of his appointment—

(a) have a right of access at all times to the books, deeds and accounts of the relevant society or branch, and to all other documents relating to its affairs, and

(b) be entitled to require from the officers of the relevant society or branch such information and explanations as that person thinks necessary.

(2) If a person appointed under section 39A(2) above fails to obtain all the information and explanations which, to the best of that person’s knowledge and belief, are necessary for purposes of doing what he has been appointed to do, that fact shall be stated in his report.

(3) A person appointed under section 39A(2) above shall be entitled—

(a) to receive notice of, and attend, any general meeting of the relevant society or branch at which any relevant matter is discussed, and

(b) to be heard at any such general meeting which he attends on any part of the business of the meeting which relates to any relevant matter.

(4) For the purposes of subsection (3) above, the following are relevant matters, namely—

(a) any report of the person appointed under subsection (2) of section 39A above, and

(b) any matter which is relevant to what that person has been appointed under that subsection to do.

(5) In this section, references to the relevant society or branch, in relation to a person appointed under section 39A(2) above, are to the society or branch responsible for his appointment under that provision.

Section 39C Power of appropriate authority to require accounts of past years to be audited.

(1) The appropriate authority may give a direction to a registered society or branch in respect of any relevant year of account of the society or branch before the year of account in which the direction is given—

(a) requiring it to appoint a qualified auditor or qualified auditors to audit its accounts and balance sheet for that year, and

(b) where it has sent to the FCA and, if the registered society or branch is a PRA -authorised person, the PRA its annual return for that year before the date of the direction, requiring it, after its accounts and balance sheet have been audited by a qualified auditor, to send the FCA and, if the registered society or branch is a PRA -authorised person, the PRA within three months from receipt of the direction a further annual return complying with the requirements of this Act (other than that as to time of sending).

(2) A failure by a registered society or branch to comply with any direction given by the appropriate authority under subsection (1) above shall be an offence under this Act.

(3) For the purposes of subsection (1) above, a year of account of a registered society or branch is relevant year of account if it is one at the end of which there is in force in relation to it a disapplication under section 32A(1) above.

Section 40 Remuneration of qualified auditors.

(1) Regulations made by the . . . Treasury under section 97 of the Co-operative and Community Benefit Societies Act 2014 may prescribe the maximum rates of remuneration to be paid by registered societies and branches for the audit of their accounts and balance sheets by qualified auditors or for the making of a report for the purposes of section 30A(4)(a) or (5) or 39A(2)(a) or (b) above .

(2) No auditor or reporting accountant of a registered society or branch shall ask for, receive, or be entitled to receive, remuneration in excess of the rate prescribed in respect of his services by regulations made by virtue of this section.

(3) For the purposes of regulations made by virtue of this section, section 97 of the Co-operative and Community Benefit Societies Act 2014 shall be taken to extend to Northern Ireland.

(4) In this section, “ reporting accountant ” means a person appointed to make a report for the purposes of section 30A(4)(a) or (5) or 39A(2)(a) or (b) above

Section 41 Valuations.

(1) Subject to the following provisions of this section, every registered society and branch, once at least in every five years, shall—

(a) cause its assets and liabilities to be valued by a qualified actuary appointed by the society or branch; and

(b) send to the FCA and, if the registered society or branch is a PRA -authorised person, the PRA a report on the condition of the society or branch;

and every valuation report shall be made in such form and shall contain such particulars as the appropriate authority may direct .

(2) For the purpose of any such valuation as is referred to in subsection (1) above, the Treasury—

(a) may appoint valuers (in this Act referred to as “ public valuers ”) who shall be qualified actuaries; and

(b) may determine the rates of remuneration to be paid by societies and branches for the services of those public valuers.

(3) When a valuation is made under subsection (1) above, the report sent ... under paragraph (b) of that subsection—

(a) shall be signed by the actuary who made the valuation and shall state his address; and

(b) shall contain an abstract to be made by the actuary of the results of his valuation, together with a statement containing such information with respect to the benefits assured and the contributions receivable by the society or branch, and of its funds and effects, debts and credits, as the appropriate authority may require.

(4) Subsection (1) above shall not apply—

(a) to a benevolent society, working men’s club, old people’s home society, cattle insurance society or to a branch of any such society or club; or

(b) to a specially authorised society or branch unless it is so directed in the authority for registering that society or branch.

(5) The appropriate authority may dispense with the provisions of subsection (1) above in respect of societies or branches to whose purposes, or to the nature of whose operations, it may deem those provisions inapplicable.

(6) The appropriate authority may dispense with the provisions of subsection (1) above in respect of any particular business conducted by a registered society or branch if, in its opinion, those provisions are inapplicable to that business because of the nature of the business or the manner in which it is conducted, and in relation to any such society or branch on which a partial exemption is conferred under this subsection, subsection (1) above shall have effect (subject to any regulations made or direction given under section 42 below) as if—

(a) it required that society or branch once at least in every five years to cause its assets and liabilities in respect of any business other than the business to which the partial exemption relates to be valued under this section; and

(b) the report required to be sent ... under subsection (1) above were a report on the assets and liabilities so valued.

Section 42 Regulations and directions . . . relating to valuations.

(1) The Treasury may by regulations provide that in relation to any registered society or branch of a class specified in the regulations, section 41 above shall have effect as if for the period of five years specified in subsection (1) of that section there were substituted a period of three years.

(2) The Treasury may by regulations provide that in relation to any registered society or branch of a class specified in the regulations, section 41 above shall have effect as if it required the society or branch—

(a) to cause its assets and liabilities in respect of any business of a class so specified to be valued under that section and to send to the FCA and, if the registered society or branch is a PRA -authorised person, the PRA a report of those assets and liabilities at least once in every three years; and

(b) to cause its assets and liabilities in respect of any other business (other than business to which a partial exemption under subsection (6) of section 41 above relates) to be so valued and to send to the FCA and, if the registered society or branch is a PRA -authorised person, the PRA a report on those assets and liabilities at least once in every five years.

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(4) Without prejudice to the preceding provisions of this section, if in the opinion of the appropriate authority it is expedient in the interests of the members of any particular registered society or branch to do so, the appropriate authority may direct that, in relation to that society or branch, section 41 above shall have effect—

(a) as if for the period of five years specified in subsection (1) of that section there were specified a period of three years; or

(b) as if it required that society or branch—

(i) to cause its assets and liabilities in respect of any particular business specified in the direction to be valued under that section and to send to the FCA and, if the registered society or branch is a PRA -authorised person, the PRA a report on those assets and liabilities at least once in every three years; and

(ii) to cause its assets and liabilities in respect of any other business (other than business to which a partial exemption under subsection (6) of that section relates) to be so valued and to send to the FCA and, if the registered society or branch is a PRA -authorised person, the PRA a report on those assets and liabilities at least once in every five years.

(5) The appropriate authority may at any time revoke a direction given by it under subsection (4) above.

(6) Any power to make regulations under this section may be exercised so as to make different provision in relation to different cases or different circumstances to which the power is applicable.

Section 43 Annual return.

(1) Every registered society and branch shall once in every year, not later than 31st July , send to the FCA a return (in this Act called an “annual return”) relating to its affairs for the year of account preceding that in which the return is required to be sent.

(2) In the case of a branch, the annual return shall be sent to the FCA through an officer appointed in that behalf by the society of which the branch forms part.

(3) Every annual return of a registered society or branch—

(a) shall be made up for the year of account to which the return relates; and

(b) shall contain the revenue account or accounts of the society or branch prepared in accordance with section 30(2) above in respect of the year of account to which the return relates and a balance sheet as at the end of that year; and

(c) shall not contain any accounts other than the revenue account or accounts for that year unless those other accounts have been examined by the auditors of the society or branch under section 38 above or been the subject of a report under section 39A(2)(a) above .

(4) Together with every annual return, a registered society or branch shall send

(a) where the year of account is one at the end of which there is in force in relation to the year a disapplication under section 32A(1) above, copies of the reports, if any, which the society or branch is required, because of the disapplication, to obtain under section 39A above; and

(b) where it is not,

a copy of the report of the auditors on the accounts and balance sheet contained in the return.

(5) Every annual return sent to the FCA by a registered society or branch to which section 41(1) above applies shall include a statement specifying either—

(a) in the case of a society or branch on which no exemption from the provisions of subsection (1) of section 41 above has been conferred, either under subsection (5) or subsection (6) of that section, the date of the last report under that section on the condition of the society or branch or the dates respectively of the last reports under that section on the assets and liabilities of the society or branch in respect of particular businesses conducted by it, and a place where a copy of that report or copies of those reports (as the case may be) may be inspected; or

(b) in the case of a society or branch on which a complete exemption from the provisions of section 41 above has been conferred under subsection (5) of that section, the reason for that exemption; or

(c) in the case of a society or branch on which a partial exemption from the provisions of section 41 above has been conferred under subsection (6) of that section, the reason for that partial exemption and the date of the last report, or the dates respectively of the last reports, under that section on the assets and liabilities of the society or branch in respect of any business or businesses conducted by it, and a place where a copy of that report or copies of those reports (as the case may be) may be inspected.

(6) Without prejudice to subsection (3) above, every annual or other return required for the purposes of this Act shall be made in such form and shall contain such particulars as the FCA may direct .

(7) If the registered society or branch is a PRA -authorised person, it shall send to the PRA a copy of the annual return sent to the FCA under subsection (1).

Section 44 Copies of annual return to be supplied on demand.

(1) On the application of a member or person interested in its funds a registered society or branch shall supply to him gratuitously either—

(a) a copy of the last annual return of the society or branch; or

(b) a balance sheet or other document duly audited containing the same particulars relating to the affairs of the society or branch as are contained in the annual return.

(2) Together with every copy of an annual return supplied in accordance with paragraph (a) of subsection (1) above and together with every balance sheet or other document supplied in accordance with paragraph (b) of that subsection, a registered society or branch shall provide a copy of the report of the auditors on the accounts and balance sheet contained in the return or on the balance sheet or document supplied, as the case may require.

(3) Where the last annual return of a registered society or branch relates to a year of account at the end of which there is in force in relation to the year a disapplication under section 32A(1) above, this section shall have effect with the following modifications—

(a) in subsection (1)(b), the words “duly audited” shall be omitted, and

(b) in subsection (2), for the words from “the report” to the end there shall be substituted “ any report which the society or branch is required, because of the disapplication, to obtain under section 39A(2)(a) above. ”

Section 45 Copies of balance sheet and valuation to be displayed.

Every registered society and branch shall keep always hung up in a conspicuous place at the registered office of the society or branch—

(a) a copy of the last annual balance sheet . . .; and

(b) a copy of the last report under section 41 above on the condition of the society or branch or, where a report or reports are required under that section in respect of a particular business or particular businesses conducted by the society or branch, a copy of the last report under that section in respect of that business or in respect of each of those businesses, as the case may require.

Section 46 Investment of funds.

(1) Subject to subsection (2) below, the trustees of a registered society or branch may, with the consent of the committee or of a majority of the members present and entitled to vote in general meeting, invest the funds of the society or branch or any part thereof, to any amount in any of the following ways, that is to say,—

(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(c) in the purchase of land, or in the erection or alteration of offices or other buildings thereon; or

(d) upon any other security expressly directed by the rules of the society or branch, other than personal security, except as is in this Act authorised with respect to loans; or

(e) in any investment in which trustees are for the time being by law authorised to invest trust funds.

(2) The rules of a society with branches and of any branch thereof may provide for the investment of funds of the society or of that branch by the trustees of any branch, or by the trustees of the society, and the consent required for any such investment shall be the consent of the committee, or of such a majority of the members as is mentioned in subsection (1) above, of the society or branch by whom the funds are invested.

(2A) Subsections (2) to (12) of section 14 of the 1992 Act shall apply in respect of the powers of investment of the trustees of a registered friendly society as they apply to the powers of investment of an incorporated friendly society; and the consent required for any such investment as is available to the trustees of a registered friendly society by virtue of this subsection shall be the same as that required under subsection (1) above.

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Section 47 Power to set up funds for purchase of Government securities on behalf of members.

(1) A registered society or branch may in accordance with its rules set up and administer a fund for the purchase, on behalf of members contributing thereto, of Defence Bonds or National Savings Certificates or such other securities of Her Majesty’s Government in the United Kingdom as the Treasury may prescribe.

(2) A registered society or branch may, in amending its rules for the purpose of this section, make provision for enabling persons to become members of the society for the purpose only of contributing to the said fund and without being entitled to any rights as members other than rights as contributors to the said fund.

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Section 48 Loans to assured members.

(1) A registered society and, subject to the rules of the society of which it is a branch, a registered branch may advance to a member of at least one full year’s standing any sum not exceeding one-half of the amount of an assurance on his life, on the written security of himself and two satisfactory sureties or, in Scotland, cautioners for repayment.

(2) The amount so advanced, with all interest thereon, may be deducted from the sum assured, without prejudice in the meantime to the operation of the security.

Section 49 Loans out of separate loan fund.

A registered society may, out of any separate loan fund to be formed by contributions or deposits from its members, make loans to members on their personal security, with or without sureties or, in Scotland, cautioners, as may be provided by the rules, subject to the following restrictions, that is to say,—

(a) a loan shall not at any time be made out of money contributed for the other purposes of the society;

(b) a member shall not be capable of holding any interest in the loan fund exceeding £800 ;

(c) the society shall not make any loan to a member on personal security beyond the amount fixed by the rules, or make any loan which, together with any money owing by a member to the society, exceeds £200 ; and

(d) the society shall not hold at any one time on deposit from its members any money beyond the amount fixed by the rules, and the amount so fixed shall not exceed two-thirds of the total sums owing to the society by the members who have borrowed from the loan fund.

Section 50 Loans of surplus funds to registered society or branch of different description.

(1) Subject to the provisions of this section and of section 51 below, a registered society or branch (other than a benevolent society or branch thereof) may, if its rules so provide, make advances by way of loan to a registered society or registered branch of a society which is not of the same description and may take such part in the government and control of the society or branch to which any such advance is made or agreed to be made as may be provided by the rules of that society or branch.

(2) An advance shall not be made by a society or branch by virtue of this section unless the rule of its assets showed a surplus over the amount of its liabilities according to the last valuation under section 41 above or, in the case of a society or branch of which the assets and liabilities are not valued under that section, according to its last annual return under section 43 above; and—

(a) no advance shall be so made to an amount greater, with any amounts outstanding in respect of previous advances so made, than the amount for the time being unapplied of that surplus;

(b) for any purpose other than the purposes of paragraph (a) above, in determining the amount so unapplied there shall be deducted any amounts outstanding in respect of advances so made after the date to which the valuation or return relates.

(2A) Subsection (2) above does not apply to advances made by a registered friendly society or a branch of such a society.

(3) An advance under this section may be interest free.

(4) Nothing in this section shall be taken to prejudice the power of a registered society or branch under section 52(2) below to contribute to the funds and take part in the management of another registered society or branch of the same description.

(5) For the purposes of this section a society or branch shall be deemed to be of the same description as another society or branch if, but only if, they are both registered by virtue of the same paragraph of section 7(1) above and, where each of them is a specially authorised society or branch, they are both established for the same purpose or purposes.

Section 51 Power of friendly society to invest in housing association.

(1) Without prejudice to section 46 above, if the rules of a registered friendly society or branch thereof expressly so direct, the trustees thereof may, with the consent of the committee or of a majority of the members present and entitled to vote in general meeting, invest the funds of the society or branch or any part thereof, in subscribing up to any amount permitted by this section for any of the share or loan capital of a housing association, other than shares or debentures not fully paid up at the time of issue.

(2) The power to make investments conferred by this section is subject to the same restrictions as are imposed by section 50(2) above on the power to make advances conferred by that section but those restrictions shall not apply to investments made by the trustees of a registered friendly society or of a branch of such a society ;

(3) For the purposes of subsection (2) of section 50 above any amounts for the time being invested by virtue of this section shall be taken into account in the same way as amounts outstanding in respect of advances made by virtue of that section, but so that, except in the case of investments made after the date to which the valuation or return relates, the amounts invested shall be taken to be amounts equal to the value of the investments according to the valuation or return referred to in the said subsection (2).

(4) For the purposes of this section, “ housing association ” has the same meaning as in the Housing Associations Act 1985 or Part II of the Housing (Northern Ireland) Order 1981. .

Section 52 Charitable subscriptions and contributions to other registered societies.

(1) A registered society or branch may subscribe out of its funds to any hospital, infirmary, charitable or provident institution, any annual or other sum which may be necessary to secure to members of the society or branch and their families the benefits of the hospital, infirmary or other institution.

(2) In accordance with its rules, a registered society or branch may contribute to the funds and take part by delegates or otherwise in the government of any other registered society or registered branch of a society without becoming a branch under this Act of that other society or branch.

(3) A registered society or branch shall not withdraw from contributing to the funds of any medical society, that is to say, a society for the purpose of relief in sickness by providing medical attendance and medicine, except on three months’ notice to the society and on payment of all contributions accrued or accruing due to the date of expiry of the notice.

Section 53 Holding of land.

(1) A registered society or branch may, if its rules so provide, acquire and hold land for the purpose of carrying on any of its activities in the names of its trustees and may dispose of, or otherwise deal with, any land so held; and—

(a) no person shall be bound to enquire as to the authority of the trustees to dispose of or deal with land;

(b) the receipt of the trustees shall be a discharge for all sums of money arising from, or in connection with, the disposal of or other dealing with land.

(2) A branch of a registered society need not for the purposes of this section be separately registered.

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Section 54 Vesting of property in trustees.

(1) Subject to section 55 below, all property belonging to a registered society, whether acquired before or after the society is registered, shall vest in the trustees for the time being of the society, for the use and benefit of the society and the members thereof and all persons claiming through the members according to the rules of the society.

(2) The property of a registered branch of a society shall vest wholly or partly in the trustees for the time being of that branch, or of any other branch of which that branch forms part (or, if the rules of the society so provide, in the trustees for the time being of the society), for the use and benefit either of the members of any such branch and persons claiming through those members or of the members of the society generally and persons claiming through them according to the rules of the society.

(3) Notwithstanding anything in subsections (1) and (2) above, the trustees of a registered society or branch shall not be liable to make good any deficiencies in the funds of the society or branch, but each trustee shall be liable only for sums of money actually received by him on account of the society or branch.

Section 55 Power of the Public Trustee to hold securities of certain friendly societies and branches.

(1) Notwithstanding anything in section 54 above any part of the funds of a friendly society which is registered by the FCA and the registered office of which is situated in England and Wales, or of any branch of such a society, and any stocks, shares or securities held by or on behalf of such a society or branch, may be transferred to the Public Trustee if, and only if,—

(a) the Public Trustee agrees to the transfer, and

(b) rules of the society or branch are, or have been, made for the purpose.

(2) The Public Trustee shall invest, in accordance with the rules, any funds so transferred to him and shall pay the interest on any stocks, shares or securities acquired by or transferred to him in pursuance of this section to the trustees of the society or branch, and shall, if and when the trustees so require, transfer the capital of the stocks, shares or securities to them, or realise the same and transfer the proceeds to them.

(3) The Public Trustee shall be completely exonerated from any liability in relation to any stock, shares or securities held by him in pursuance of this section, and no action shall lie against the Public Trustee in respect of any such stock, shares or securities provided that he acts in accordance with the provisions of this section.

(4) This section does not extend to Scotland or Northern Ireland .

Section 56 Legal proceedings concerning property.

In all legal proceedings whatsoever concerning any property vested in the trustees of a registered society or branch, the property may be stated to be the property of the trustees in their own names as trustees for the society or branch without further description.