What is a Private Club, and What Laws Apply to Them?
You don’t have to have the mega-wealth of a hedge-fund broker or real estate magnate to enjoy the benefits of membership in a private club. Sure, yacht clubs, country clubs, and golf clubs can all be private clubs. But dog clubs, gun clubs, garden clubs, along with VFW Halls can all be private clubs.
How is a private club defined?
Every state has its own definition of a private club. But generally, a private club is a place to meet and mingle with people of similar interests. The club is private because not just anyone can join or enter. You must be a member. That means you will probably pay dues or membership fees. The club is incorporated and governed according to the laws of its state.
Why do people join private clubs?
People join private clubs for many reasons. A private club can be an excellent place to make business contacts (which helps offset the costs of membership). But people also join for social status and recognition, quality dining, the facilities at the club, and just to have fun.
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Keeping the private club private
The right to immunity prevents public authorities from meddling in the business of a private club. As an example, the city can’t interrupt a private club party as long as the party is organized for a legitimate reason ( New Year’s Eve party) and the occasion does not cause a breach of the peace (the music is too loud).
Civil rights laws can apply to private clubs
To preserve their right to privacy and freedom of association, private (members and their guests only) clubs are exempted from civil rights law. In other words, if your club fully complies with the definition of a private club, then the club is under no obligation to accept members based on race, color, nationality, etc. But to qualify, the private club must truly be for members only and have selective membership criteria.
So a club that will admit anyone except African Americans does not qualify as a private club. The ACLU of Pennsylvania uses as a real example of a “private” swim club that would not allow black people to join. The Courts considered “the history and purpose of the club (including whether it was created to circumvent desegregation), (and if) the club advertises for members.” In this case, the Courts found that membership in this swim club was generally open to the public and therefore it was a “public accommodation” and not a private club. Thus, the club could not discriminate.
Serving alcohol in private clubs
Many private clubs are popular because they offer their members a fine dining experience in an exclusive setting. The food quality is high, but the prices may be relatively low because the membership fees help offset the costs. Many private clubs can also serve alcohol without regard to local laws regulating public sales. So if local and state laws allow it, a country club may serve alcohol – to its members and their guests only – in a dry county. Like everything else about private clubs, the specific laws vary in each state and municipality.
Usually, only the member can pay for the alcohol and the beverage cannot be removed from the premises. Some areas with strict alcohol laws may allow a different kind of private club. A restaurant may become a "private club" by charging a small "membership fee" to enter. This temporary membership dodges the law by letting the general public come in. If you are going to serve alcohol at your private club, you probably want your bartenders to have their alcohol seller-server certificate. Take our course today to learn more about the laws in your state.