Land Roots Community Land Project
10 / 4 / 06
Legal Status for Co-Ownership of land questionaire: 

Land Roots is currently an unincorporated body with a constitution. Our next step is to adopt a Legal Status. We plan to have one legal structure holding the land in trust for its membership. 
We will also form a Limited Liability Partnership (L.L.P) as an umberella group for all the partner organisations and individuals who will live and work on the land, giving them limited liability.

It is very important that we get the legal status right from the beginning so that were not held up with time consuming and costly problems once we get going. We are hoping to be incorporated and ready to sell shares this summer, but it will take as long as it takes.
Land Roots wants to put together a temporary email ‘Land Roots Legal Status Think Tank’ to help get all the facts before we finally decide what our legal status will be. We are inviting you to be part of this think tank because of your particular expertise in this or related issues and hope that you will help us with our efforts to make land roots work for the benefit of the land and the people. 
As well as being very useful for Land Roots we feel that it will be of use to similar community land organisations looking for the best legal structure in the future.

Questionaire will be sent to:
Greg Pilley and Martin Large, Community Land Trust
Chris Cook and Mary Fee, Partnership Consulting
Woody Wood, Devolve.
Simon Taylor. 
Jo Brown and Fergus, TANC
Upstart
Leicester Co-operative Development Agency
Ian Cohen
We would appreciate your suggestions on other interested indivuals or groups who could have an input on this, or who could benefit from this information once it is collated.

We will also invite similar land co-owning organisations (actual and aspiring) to have an input:
Organisations we will contact are:
Land Matters
Lammas
Plants For A Future
Treesponsibility.
Woods For All
Green and away 
Heartland devon
And others through the Eco-Village Network

•	What kind of legal status do they have?
•	How have you gone about deciding your legal status?
•	How do you find it, does it do what you want, ease of use?
•	Advantages and disadvantages you found with your legal Status 

Land Roots is hosting a 1 day seminar in Nottingham, on Saturday May 20th   
this will be led by Greg Pilley and Martin Large of the Community Farm Land Trust.
For further details and if you wish to attend, email: roots@landroots.co.uk

Questionaire to ascertain the best legal status for ‘Co-Ownership of Land’.

This Questionaire is to ascertain the Pro’s and Con’s of various forms of Lagal Status for the incorporation of projects working on ‘Co-ownership of Land’ including Land Roots. With the aim of creating an easy to follow chart to help groups understand the options and move swiftly through this difficult process. 
Please add your questions and comments (evan if it contradicts what I have written), in a colour so that we can easily see what you add, and email back to us, Thankyou for you cooperation.

We want to look at various options Including LLP, CLG, CIC, IPS,Trust, Co-Op and Charity asking general questions about each Legal Status, in relation to:

•	Asset lock.
•	Taxation.
•	Flexibility. 
•	Money flow. 
•	Growth potential. 
•	Community involvement / participation / co-operation
•	Stakeholder. 
•	Accountability. 
•	Other angles or issues we should be thinking about?

Limited Liability Partnerships: LLP
For Land Roots the question is not ‘do we have an LLP as umberella group?’ (we have just about decided on this) but what will work best for Land Roots (in conjunction with the LLP) as the holder of the land.
We are keepng this section in to clarify issues for our own benefit and the benefit of others who may have similar questions.

Limited Liability Partnership (“LLP”) is a new UK legal entity – introduced on 6 April 2001.  Despite the name, the LLP is not legally a partnership but is, like a limited company:
•	a corporate body - it has a separate continuing legal existence independent of its members and can therefore own property and enter into contracts;
•	limited in liability – members cannot lose more than they invest. 

Unlike a limited company, any “stakeholder” in this “Open” Corporate body (and not just investors of money) may be a member by subscribing to a “LLP agreement” which may take any form the members agree, and in fact need not even be in writing.

Research:
•	Keep talking to Chris Cook to clarify (in words that we can all understand) all the issues
•	Does Simon Taylors legal status computer programme include LLP‘s? (Find out who wrote it) invite him to the may 20th clft meet day.
•	Get paperwork from Leicester Co-op Development agency regarding the work they did on the co-operative LLP.
•	Get info from Greg Pilley on Co-Ops reaction to LLP’s
•	Look again at the LLP agreement for icefall that woody gave me, and other LLP agreements.
•	Look at rules etc

Pros:
•	a corporate body - it has a separate continuing legal existence independent of its members, and can therefore own property and enter into contracts.
•	limited in liability – members cannot lose more than they invest. 
•	joint and several responsibiltiy, (explain this so all can understand) 
•	Open economic partnership
•	people can invest in own property 
•	proportional equity shares, (explain this so all can understand)
•	Write your own rules, flexible, the LLP is a ‘blank sheet’ and rules can be written to suit, rather than having to follow the rules for a CIC or other. (blank sheets can be scary) so we can adapt other models / set of qualities we like a and we (chris) can build it.
•	no reporting back to the govt, as far as possible opting out of the system
•	Don’t have to pay everytime we need to change  / add rules, which were bound to need to do.
•	can be registered before feasability is completed

Community Land 
Partnership (LLP)
		The LLP is an umbrella looking after all those within it.

The Trustee Member (LR CIC or CLG) owns the land. As a CIC, an asset lock would protect land but also prevents using it as collatoral.

LR members would be shareholders investing their money in land, buildings etc. They might also be living or working on site. Individuals can belong to more than one group. Organisations can also join a group (eg a weavers’ co-op would join the Workers’/Traders Co-Op).	
	
Trustee Member (CIC/CLG)
		
Shareholders				

Housing 
Co-Op
		
Workers’/ Trading Co-Op				

Cons:
•	write your own manual, both + and –
•	some may say that the LLP is not accountable to anyone, its members of course, but no legal body that can make sure we don’t mess up?
•	Tax?
•	The LLP would not offer the asset lock that may be required to safeguard land in perpetuity, but could work alongside a cic or clg etc 
Querries: 
•	Do we need separate legal entity as part of the LLP to be holders of the land or can it be another LLP, ie can we MAKE / WRITE an asset lock in the form of a covenant??? (What is  a covenent and is it appropriate?)Just to keep the whole process out of the hands of the govt??
•	Public liability insurance, is this not needed with LLP???
•	Show me framework to fit it into? Language to use? What form is the agreemment? 

What similar groups use this and how do they find it?

Notes:
Do we really want to give our power back to the govt by using a legal form that they can interfere with?  How can they interfere?
With LLP we don’t report back to them, (only annual financial returns) we can have a body that is elected by the Eco-Share holders to report to, accountable to the shareholders not the govt, or appoint another body to report to?

Conclusion:
Land roots will be using this legal status to…
Because…

Land Roots will not be using this legal Status because…

Company Limited by Guarantee, CLG.

Research:
•	Have another session with Simon Taylor? Or get copy of the legal status programme? 
•	Protecting the land could also be done through a covenant(?) rather than the asset lock of a CIC, which would mean that the Trustee Member could be a CLG rather than a CIC.
•	What is a covenant and how does it work?

Pros:
•	Recognised and known. 
•	A CLG could be founded without closing either the CIC or LLP routes. It could be a logical progression from Unincorporated Organisation to CLG to CIC, then to CIC incorporated as part of a LLP. 
•	There was no need to wait for the feasibility study before founding a CLG.
•	2 teir structure, members and directors(+&-)
•	A CLG is relatively easy to set up as all it really requires are Mem and Arts. It is possible to become a CLG and convert to a CIC later. 
•	can be registered before feasability is completed
Cons:
•	2 teir structure, members and directors(+&-)
•	Answerable to govt bodies, which and how?
•	Pay every time you change wording, how much?

Queries:
•	Do we need separate legal entity as part of the LLP to be holders of the land? pros and cons of CLG for this?
•	Tax etc 
•	Do we really want to give our power back to the govt by using a legal form that they can interfere with?  And know all our business? How can they interfere?

Notes:

What similar groups use this and how do they find it?

Conclusion: 
Land roots will be using this legal status to…
Because…

Land Roots will not be using this legal Status because…

Community Interest Company, CIC.

Research:
•	Have another session with Simon Taylor, 

Pros: 
•	Has built in asset lock
•	C.I.C. can be registered before feasability is completed, 
•	Needs ‘Community interest Statement’ (we could put one in the LLP anyway)

Cons:
•	Needs ‘Community interest Statement’
•	Not stood the test of time, really new.

Querries:
•	Show me framework to fit it into? language to use? 
•	can this be registered before feasability is completed?
Notes:

What similar groups use this and how do they find it?

Conclusion: 
Land roots will be using this legal status to…
Because…

Land Roots will not be using this legal Status because…

Industrial and Provident Society, IPS.

Research:
•	Have another session with Simon Taylor, 
•	Get info from Greg Pilley, they use IPS, so does woody(prefers LLP)

Pros:
•	Known entity, pitfalls known

Cons:
•	Tennants can’t take stakes

Querries:
•	can this be registered before feasability is completed?
•	

Notes:

What similar groups use this status and how do they find it?

Conclusion: 
Land roots will be using this legal status to…
Because…

Land Roots will not be using this legal Status because…

Trust. 

Research:
•	Look at woodland trust info.
•	Get info from Greg Pilley 

Pros:
•	Asset Lock.
•	people can invest in own property, 

Cons:
•	(Woody says not to touch them too much trouble, trustees can’t benefit)

Querries:
•	Show me framework to fit it into? language to use? 
•	can this be registered before feasability is completed?

What similar groups use this and how do they find it?
Notes:

Conclusion: 
Land roots will be using this legal status to…
Because…

Land Roots will not be using this legal Status because…

CO-OP: 

Research:
•	Talk to Radical Roots
•	Get info from Greg Pilley re what R R says about LLP’s
•	Why are they so opposed to LLP’s and can this be rectified? Is it justified??

Pros:
•	History
•	Success rate
•	Trusted
•	Co-operative and collaberative.

Cons:
•	Could be unweildy

Querries:
•	Show me framework to fit it into? language to use? 
•	Is this a legal status, or just a way of working?

What similar groups use this and how do they find it?

Notes: 

Conclusion: 

Land roots will be using this legal status to…
Because…

Land Roots will not be using this legal Status because…

Charity: 

Research:
Talk to woods for all and othwer land charities.

Pros:
•	Tax exempt?

Cons:
•	

Querries:
•	Show me framework to fit it into? language to use? 
•	Is this a legal status, or just a way of working?

What similar groups use this and how do they find it?

Notes: 
This is not the right status for Land Roots but may be right for others.
Conclusion: 

Land roots will be using this legal status to…
Because…

Land Roots will not be using this legal Status because…