New charitable and commercial structure for Old Brentwoods Society: members have given the go-ahead

Developments in the use of the Old Brentwoods clubhouse and grounds in Ashwells Road, Bentley, particularly in the last decade, had made it inevitable that the 125-year-old Society would have to replace its administrative and management structure. Legally and commercially, this was essential to enable an increasingly popular facility to improve its operations, remain viable and serve Old Brentwoods and the local community for another 125 years.

Accordingly, proposals to create a new structure, comprising two charities and a trading company, were drawn up by the Society’s board and ratified at two extraordinary meetings of members in January and February.

A protracted implementation period is likely to last until the AGM, scheduled for September 6th. During this period, City law firm Bates Wells will continue to support the Society, in overseeing the incorporation of the new company, seeking Charity Commission approval of the new arrangements, drafting leases and handling other elements of due diligence.

When the Ashwells Road operation began in 1976, it was essentially for members of the Old Brentwoods Society. For the first four decades, OBs accounted for 90 per cent of the revenue. Former alumni have always made substantial use of clubhouse and pitches and continue to do so. However, the pattern of usage was changing. Increasingly, recent school leavers were studying and working away from the area - and, therefore, from Ashwells Road. Covid restrictions also hit revenue while overheads, repairs and refurbishment costs remained high. However, non-Old Brentwoods were stepping up their involvement via sports teams and social events.

Accordingly, Club membership was opened up in 2014 to non-OBs. Participation and spending increased, helping to sustain a community sports and social club. In less than a decade, they have provided the vast majority of clubhouse and pitch expenditure. There is no doubt that the pattern will continue.

The Society had always been an unincorporated association, a structure used by small volunteer-based groups which trade between themselves and have very limited interaction with third parties. This was consistent with Ashwells Road’s land and assets being held in trust on behalf of Old Brentwoods Society members, the four trustees being OBs. However, an unincorporated association is not a distinct legal entity with liability, so its members are responsible for debts. It could not sue or be sued, own property, enter into formal contracts, borrow money or obtain grants from many major sports bodies. Further, it (meaning the members) could be subject to tax on profitable trade with non-Society people.

In short, unincorporated association status would have to be wound up and replaced by a new ‘fit for purpose’ structure.

In 2022/23, the Board initiated a broad review of the Society’s operations, enlisting the advice of Society members with legal and accounting skills. An initial report from chartered accountants Berkeley Townsend was supplemented with input from other third party experts. There was universal consensus that the Society would benefit from a form of charitable status, probably combined with a wholly owned trading subsidiary in limited company form to run the commercial activities. The relationship between charitable activities and a trading company would have to be such as to avoid significant tax liabilities.

The key considerations were preserving the existence, identity and values of the Old Brentwoods Society; maintaining the special relationship with the School and the Brentwood School Association; keeping ultimate control of decision making in the hands of Old Brentwoods while accommodating the operational input of non-Old Brentwoods; encouraging Old Brentwoods to continue using Ashwells Road facilities as much as possible; and extending the scope for charitable endeavours.

The commercial emphasis would be on ensuring the long-term financial self-sufficiency of clubhouse and grounds; providing a tax efficient trading environment, minimising Corporation Tax on trading pofits and optimising Gift Aid on subscriptions and donations; and on entering contracts, soliciting grants and negotating loans (as necessary). The new arrangements would eliminate the threat of Society office holders and trustees incurring personal liability.

Restructuring: two charities and an operating company

Given these considerations, there will be two charities, set up as companies, separate and independent but linked, relating respectively to the Old Brentwoods Society and the Old Brentwoods Club. The latter will oversee a new trading company, Old Brentwoods Club Trading Ltd. Both charities will have objectives rooted in public benefit: providing facilities for recreation, particularly among people in the Brentwood area; advancing education and supporting the charitable activities of the School; and pursuing other charitable activities.

Old Brentwoods Society charity (No.1) will own the land and grant a 125-year full repairing and insuring lease to the Club charity (No.2); approve the appointment of its trustees and support it in seeking grants and loans. Existing subscribers to the OB Society become founder members while other alumni can join by paying a fee.

Old Brentwoods Club charity (No.2) will draw its membership from those already paying the £30 annual club fee and from new people (including some OBs as individuals) with the Society itself becoming a member to protect its formal rights.

This charity will make its land and facilities available to people in and around Brentwood - the ‘community amateur sports charitable purpose.’ It will be responsible for the governance of Old Brentwoods Club Trading Ltd: appointing its three directors; granting it a licence to use the land and buildings appropriately; and agreeing staffing, terms of use and financial arrangements.

Old Brentwoods Club Trading Ltd

This company will transfer profits to the two charities at a pre-agreed ratio within nine months of the end of each financial year.

Christian Cooper, Chairman of the Society of Old Brentwoods, explained: “In recent years, it had become increasingly clear that the unincorporated association structure was woefully inadequate for running Ashwells Road, given its growing scale of operations and considerable prospects for expansion. We can now be confident that all the hard work---and it has been very hard work indeed at times-- has produced a strong and viable set of linked arrangements, encompassing charitable endeavours and a social and sporting service which meets the needs of both Old Brentwoods and area residents.”

Ashwells Road planning application

Since 2021, the Society has been pursuing a planning opportunity re a piece of Ashwells Road land - known as the Triangle - currently licensed to a neighbour for grazing. A pre-application enquiry has been considered by Brentwood Council and a formal planning application should be submitted during 2025. However, given limited time and resources, priority has been given to the Padel project - to provide courts on that parcel of land to the north of the overspill car park, affectionately known as the ‘cabbage patch.’

The pause on the planning application has been welcomed for various reasons, including the prospect of the new National Planning Policy framework being formally implemented. The sale of land under unincorporated association status might have attracted capital gains tax. Under the Society’s revised structure, CGT should be avoided.