Nonprofit Corporation Membership Exit and Termination in Tennessee
At a glance
| Governing law and covered members | Tenn. Code Ann. §§ 48-56-103, -201–202, -204, -301–302; nonprofit may have no members; exit rules apply when it does |
|---|---|
| Documents, classes, and decision maker | Charter/bylaws may establish classes, transfer rights, and fair exit procedure; § 48-56-302 names authorized decision maker but no fixed board-vote threshold |
| Transfer of membership rights | Membership and rights nontransferable unless charter/bylaws authorize; later restriction needs member and affected-member approval for existing rights (§ 48-56-202) |
| Voluntary resignation | Member may resign at any time; § 48-56-301 states no prescribed notice or form and preserves obligations to corporation |
| Expulsion, suspension, and termination | Unless charter provides removal/termination without cause, fair and reasonable good-faith procedure required; nonpayment may support suspension or termination (§§ 48-56-204(b), -302(a)) |
| Notice and opportunity to respond | Document procedure route: at least 15 days' written reasons and hearing opportunity at least 5 days before effective date; alternatively contextual fairness; mailed notice first class/certified to record address (§ 48-56-302(b), (d)) |
| Rights and records after exit | § 48-56-302 distinguishes suspension from expulsion/termination; it states no separate public filing or member-record update step |
| Dues and prior commitments | Resignation preserves prior obligations; dues liability requires member's express/implied consent; expelled/suspended member may still owe dues (§§ 48-56-204, -301(b), -302(f)) |
| Challenge period and remedy | Challenge, including defective-notice claim, must start within 1 year after effective date (§ 48-56-302(e)); statute does not predetermine merits |
Requirements one by one
Transfers and resignation
Under § 48-56-202(a), a membership or a right arising from it cannot be transferred unless the charter or bylaws authorize it. If transfer rights already exist, subsection (b) protects a holder whose membership predates a new restriction: members and that affected member must approve it before it binds that holder. Section 48-56-301 permits resignation at any time but preserves obligations owed to the corporation.
Suspension and termination procedure
Section 48-56-302(a) ordinarily calls for a fair, reasonable procedure carried out in good faith. The charter may provide for removal and termination without cause. Under subsection (b), one statutory fair-procedure route uses at least 15 days' written notice with reasons and an opportunity to be heard at least five days before the effective date by someone authorized to stop the action. A procedure fair and reasonable in the circumstances is another route. If written notice is mailed, subsection (d) requires first-class or certified mail to the last address in corporate records.
What trips people up
Section 48-56-204 separates dues liability from membership consequences. A charter, bylaw, or board resolution imposing dues alone does not create a debt; express or implied member consent can. Yet subsection (b) allows suspension or termination for nonpayment even when the member does not owe the dues under that liability rule. Section 48-56-302(f) also permits dues liability after expulsion or suspension. A resignation does not erase prior obligations under § 48-56-301(b).
Section 48-56-302(e) starts the one-year challenge period at the effective date of expulsion, suspension, or termination, including when the challenge alleges defective notice. Its subsection (g) excludes a qualifying charter or bylaw amendment from the termination procedure; an amendment and an individualized expulsion should not be treated as the same act.
Common questions
Must every nonprofit have members?
No. Section 48-56-103 permits a corporation without members; this member-exit procedure applies when membership exists.
Can voting rights differ by member class?
Yes. Section 48-56-201 lets the charter or bylaws establish classes with different voting and other rights.
Statutes and sources
- Tenn. Code Ann. § 48-56-103 — optional membership; accessed October 4, 2026.
- Tenn. Code Ann. § 48-56-201 — class rights; accessed October 4, 2026.
- Tenn. Code Ann. § 48-56-202 — transfers and new restrictions; accessed October 4, 2026.
- Tenn. Code Ann. § 48-56-204 — dues liability and membership consequences; accessed October 4, 2026.
- Tenn. Code Ann. § 48-56-301 — resignation and obligations; accessed October 4, 2026.
- Tenn. Code Ann. § 48-56-302 — termination, notice, and challenge deadline; accessed October 4, 2026.
Source links
Every statute quoted above, linked, with the date we checked it.
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