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A Memorandum of Understanding (MOU) will typically be used in the not-for-profit sector when organisations wish to co-operate or share information with each other, allowing each to make the most of the other's specialist skills or knowledge.
Before reading on, make sure that you have read our guide to working with other organisations, which you can download from the Working with Others landing page.
A MOU will typically establish a framework for the collaboration between the organisations and express the common goals or vision of the parties to the MOU. In general, a MOU will not deal with the specific details of particular projects. A MOU is therefore usually more of a 'high level' agreement.
An MOU is generally considered ‘an agreement to agree’ or an agreement to enter into a more specific and comprehensive contract or agreement at a later time after further negotiations. However this is not always the case. To help avoid any uncertainty about whether an MOU is legally binding, your organisation should make sure the MOU contains a specific statement to the effect that it is not intended to create legally binding obligations. If you need to rely on the other organisation taking certain actions or if your organisation stands to lose money if the other party doesn’t act – your organisation should enter into a contractual arrangement.
The information on this website is intended as a guide only, and is not legal advice. If you or your organisation has a specific legal issue, you should seek advice before making a decision about what to do.
More detailed information is contained in our fact sheet below regarding:
- what a MOU is and when one should be used
- the issues a MOU should cover, and
- your organisation's obligations under a MOU and whether a MOU is a legally binding document
Many community organisations require a memorandum of understanding to formalise working together or other joint objectives.
This base template provides an example of the way a MOU can be set out and the types of details it may include.
Health Justice Australia - Entering into a health Justice partnership: Memorandum of understanding resource kit: This kit includes a template MOU with inbuilt alternatives to suit a broad range of situations.
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