The caretaker discovers a water leak under the kitchen sink and, as the situation is urgent, contacts a plumber to get the problem fixed without getting the approval of the hall committee first:
- It is in order for the committee to retrospectively approve payment given the urgency of the situation that arose and no further action is necessary
- The caretaker should be made to pay the bill themselves as they have acted beyond their powers
- The committee agree to the payment of the bill being made in retrospect and then draw up a policy for use in the future whereby certain trustees are nominated to jointly agree emergency expenditure up to a defined limit on behalf of the trustees as a whole
Here is another situation where there is a text book answer and a practical answers.
Firstly, however, it is just not acceptable to approve expenditure retrospectively as a matter of course. It happens all too often but it is very bad practice and has the potential to lead to all sorts of problems. No one can, in the normal course of events, approve expenditure without the full support of the committee/trustees. Option 1 is incorrect.
The text book answer here is option 2. the caretaker took it upon themselves to incur the expenditure and this was clearly beyond their remit and so they should pay the bill themselves. But is option 2 really the correct answer.
Quite clearly, the caretaker acted in good faith and with the best interests of the hall in mind so are they really at fault here? No, of course not. The trustees are at fault for having no emergency plan in place to cater for likely situations. The trustees should have what is called a 'standing order' whereby they agree and document a policy and a procedure to be followed in such circumstances. Usually this involves appointing a standing committee of three trustees, any two of whom can approve expenditure up to a specified level in the event of an emergency such as this on behalf of the committee as a whole.