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Myths Regarding Non-Profit Corporations

Non-Profit Corporations

A non-profit corporation is a corporate entity that has been established under certain federal regulations.  Non-profit entities are primarily engaged in educational, scientific, religious, or charitable endeavors.  Entities that qualify for 501(c)(3) status can also enjoy federal and state tax-exempt status, and donations made to the entity by individuals may be tax-deductible.

Corporations that exist on a “for-profit” basis, such as Ford Motor Company, and non-profits share some common characteristics, such as:

  • Shareholders, officers, directors, and members of these entities are generally protected from personal liability for any debts or obligations that the entity may incur in its business operations.
  • Both entities can earn profits from their corporate activities.  In fact, many non-profit corporations earn very substantial profits, but they cannot distribute them.
  • Both entities have boards of directors.


“Non-profit entities cannot be sued”

Non-profit entities can be, and sometimes are, sued.  The old rule of “charitable immunity” began well over 150 years ago under British law, when charitable corporations could not be sued by people who claimed to be injured from their activities.  This theory, in recent years, has become largely obsolete.

“Non-profit entities Don't need insurance”

Because non-profit entities face the risk of being sued, they can protect themselves with insurance.  The need for any coverage depends on the group’s activities, its state laws, and other factors.  Coverages can include director’s and officer’ liability (often called “D & O” insurance) that generally protects directors and officers from a claim or suit relating to the entity’s management; general liability that is designed to protect against claims or suits that arise out of the entity’s business activities; workers' compensation that addresses claims by employees who were hurt on the job; auto insurance if the non-profit owns vehicles; and event liability insurance if the group’s General Liability policy does not cover events.

“Non-profit corporations cannot make a profit”

Non-profit corporations can raise tremendous amounts of money, and many raise millions of dollars each year.  However, non-profit corporations cannot distribute their income or profits to their officers, directors, and members.

If you have any questions about non-profit corporations in the equine industry, please let me know.

Categories: Insurance

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is considered to be one of the nation's leading attorneys in the field of equine law. A frequent author and speaker on legal issues, she has written over 400 published articles, three books, and has lectured at seminars, conventions, and conferences in 29 states on issues involving law, liability, risk management, and insurance. For more information, please also visit and, and

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Our Equine law blog (and its author) in the news!

Julie Fershtman, author of our popular and prolific Equine Law Blog, was interviewed by the State Bar of Michigan. The interview, which called Fershtman "Lawyer-Blogger," discussed our Equine Law Blog. We truly believe that this blog is the nation's most active blog serving the equine industry on equine law topics, and we thank you for visiting it. Read more here.

Julie Fershtman’s Recent and Upcoming Equine Law Speaking Engagements Include:

National Conference on Equine Law in Louisville, Kentucky on April 29, 2020. Topic will be on Waivers/Releases of Liability Involving Minor Participants. 

U.S. Hunter Jumper Association (USHJA) Annual Convention in Denver, Colorado on December 10, 2019. Topic will be on Equine Liability. 

IRMI Emmett J. Vaughan Agribusiness Conference (“AgriCon”) in Sacramento, CA (April 2019), and Richmond, VA (June 2019) and in Des Moines, IA (September 2019), on topics of “Equine Activity Liability Acts” and “Equine Mortality Insurance Disputes.”

National Conference on Equine Law in May 2019 in Lexington, KY, on the topic of “Equine Activity Liability Act Updates” and liabilities involving hosting of equine clinics. 

Agricultural Claims Conference in Kansas City, MO, in March 2019 on topics of “Loose Livestock Liabilities.”

2018 American Bar Association Annual Meeting in Chicago, IL, on “Equine Mortality Coverage and Disputes.”

November 2018, American Horse Council webinar on “Equine Liability.”

Honors & Recognitions

Equine lawyer, Julie Fershtman, has received these prestigious equine industry awards from respected equine organizations:

"Excellence in the Advancement of Animal Law Award" - American Bar Association Tort Trial & Insurance Law Section Animal Law Committee

"Distinguished Service Award" - American Youth Horse Council

"Industry Service Award" - Michigan Equine Partnership

"Catalyst Award"- Michigan Horse Council

"Outstanding Achievement Award" - American Riding Instructors Association 

"Partner in Safety Award" - American Riding Instructors Association 

"Associate Service Award" - United Professional Horseman's Association

"National Partnership in Safety" Award" - Certified Horsemanship Association 

What our Equine Law Services can Provide

Handling breach of contract, fraud/ misrepresentation, commercial code, and other claims involving equine-related transactions including purchases/sales, leases, mare leases/foal transfers, and partnerships.

Litigating disputes in court or through alternative dispute resolution (arbitration, mediation, facilitation).

Defending equine/farm/equestrian industry professionals,  businesses, and associations in personal injury claims and lawsuits.

Drafting and negotiating contracts for boarding, training, sales, waivers/releases, leases, and numerous other equine-related transactions.

Representing and advising insurers on  coverage and policy language as well as litigation;

Advising equine industry clubs and associations regarding management, rules, bylaws, disputes, and regulations.

Representing some of the equine industry's top trainers, competitors, stables, and associations.

Counseling industry professionals, stable managers, and individual horse owners. 


Did you know Julie Fershtman has spoken at the American Horse Council Annual Meeting, Equine Affaire, Midwest Horse Fair, Equitana USA, US Dressage Federation Annual Meeting, North American Riding for the Handicapped (now PATH International) Annual Meeting, American Morgan Horse Association Annual Meeting, American Paint Horse Association Annual Meeting, US Pony Clubs, Inc.'s Annual Meeting, All-American Quarter Horse Congress, American Youth Horse Council Annual Meeting, American Riding Instructors Association Annual Meeting, CHA Annual Meeting, and numerous others? Consider signing her up for your convention. Contact Julie.

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