Mmutle NO and Others v ABSA Bank Ltd and Others [2023] ZANWHC 158
The applicants approached the court for an order to compel the first respondent (ABSA) to recognise them as trustees of the Maribaland Development Trust (the trust) and to give them full access to the trust’s bank accounts. A temporary order to this effect was granted on 13 March 2023, when only ABSA and the Master of the High Court (the second respondent) were cited as respondents. A return date of 4 May 2023 was set for the respondents and any other party to show cause why the temporary order should not be made final. After the granting of the temporary order, the 3rd to 76th respondents were cited – all being members of the community and beneficiaries of the trust which was formed in 2009 after a successful land claim. The first trustees were authorised by the Master in 2012. The applicants alleged that they did not give account of their administration of the trust property, that their term of office as trustees expired in October 2014, and that they did not arrange elections for the appointment of new trustees. The applicants (applicants 1 to 11 – the trust being the 12th applicant) then, as beneficiaries, held a meeting and resolved to appoint themselves as trustees in October 2021. They were authorised by the Master in December 2021, but the Master later withdrew the letters of authority after receiving correspondence from the first trustees. The applicants allege that they were appointed (and subsequently authorised under section 6) by the Master under the provisions of section 7 of the Trust Property Control Act, 57 of 1988. The respondents’ case is that no annual general meeting was held and that, in accordance with the trust deed, therefore no new trustees were appointed leading to the conclusion that the first trustees are still the trustees of the trust.
The court (Djaje DJP) held that section 7 cannot find application as it can only be relied on by the Master if the office of trustee becomes vacant “in the absence of any provision in the trust instrument.” The provisions of the trust deed regarding the holding of an annual general meeting was not complied with in the process of appointing the applicants as trustees and therefore the original trustees were still in office. The temporary order was therefore discharged and the counter-application by the respondents was granted that the first trustees were still in office. Any replacement of the trustees can only happen in accordance with the provisions of the trust deed.
Comment
The judgement reiterates the importance of compliance with the provisions of a trust instrument.