This section is from the book "Popular Law Library Vol8 Partnership, Private Corporations, Public Corporations", by Albert H. Putney. Also available from Amazon: Popular Law-Dictionary.
Unincorporated clubs and associations formed for political, social, religious, educational or charitable purposes and not for financial gain, are not partnerships. The members are not mutual agents; the officers are not general agents unless expressly so made. And when any officer or committee of the club or association performs any act whereby it is sought to hold a member financially responsible, it must be shown that the member authorized the doing of the act in his behalf or that he obligated himself to give it a certain financial support. The officer, or committee, and those members authorizing the act by vote or contract are liable. One cannot look at the object of the association, consider its scope, and then seek to bind the association as a body for an act done by an officer in furtherance of that object and within the natural scope of the association activities. Their activities are gratuitous and the range is determined from day to day by personal volition.
10 Dry vs. Bowsell, 1 Campbell, 329, Ames' Cases on Partnership, page 18.
Much of the litigation under the law of partnership arises from the question of the extent of the right, with notice of the partnership and without notice of the limitations of authority, to assume that certain powers of agency exist. The general rule is that a third party must consider the nature of the partnership business, the ordinary, customary rules regulating the conduct of such business and within such scope he may safely assume, without notice to the contrary, that each partner of the firm has authority to buy, sell, and contract. But he deals with a club or association, formed for non-pecuniary purposes, with notice that it is not a partnership, and so it is incumbent on him to ascertain who will be bound.
In Burt vs. Lathrop,11 a large number of dentists were using a hard-rubber material, which use, it was claimed, was an infringement on certain patent rights. The dentists formed an association, with a membership fee of five dollars, and elected officers. These officers employed an attorney and for his services he brought a suit joining all the members of the association on the theory that they constituted a partnership. In the decision of this case the court said: "We can find in this arrangement nothing analogous to a partnership. There was no common business, and nothing involving profit and loss in a business sense. No one was empowered to make contracts binding on the subscribers personally, and no one was to be liable except for assessments, nor even for those except as he saw fit to pay them to keep his membership."
1152 Mich., 106; 17 N. W. Rep., 16, Mechem's Cases on Partnership, p. 4.