Difference Between Limited by Guarantee and By Shares

Desai, Vinny, Sai, Ani, May, Jack, Candice and Homer are badminton enthusiasts. They are members of a club ‘Badminton for Beginners’. The club is not incorporated in any way.

Desai, Vinny and Sai are the committee members of the club. The object of the club is to promote badminton. As such the members meet regularly to play badminton and the club holds badminton tournaments once a month to promote the game in Brisbane.

As the club has no assets and it has no fixed premises from which to play badminton, the tournaments are held in local parks around Brisbane. The club supplies food and drinks to participants during the tournaments. In one of these tournaments, Daisy, a participant, suffered from food poisoning after consuming the food supplied by the club. Daisy wants to sue in negligence to recover her medical costs.

Advise Daisy whether (I) Badminton for Beginners is liable (ii) whether Jack, Candice, Ani, May and Homer are liable and (iii) whether Desai, Vinny and Sai are liable. Cite appropriate case law in your answer.

The committee is considering changing the structure of the club to a company structure. They want to know the differences and similarities between a company limited by guarantee and a company limited by shares. Explain two key differences and similarities between the two structures, citing appropriate legislation in your answer.