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Court case: Cunningham-Moorat v Bester – validity of trust – initial donation

A recent court judgment is of interest to trustees of inter vivos trusts. In the case of Cunningham-Moorat NO vs Bester NO, unreported case no. 45551/2012 (High Court Gauteng local division), the plaintiffs contended that the non-payment of the R100 donation by the founder to the trustees meant that the trust was not properly established and therefore never legally existed.
The High Court ruled that it is not an essential factor for the formation of a valid trust that the trust property must be transferred to the trustees. If no such transfer happens, the trustees acquire the right to demand the trust property from the founder.

The court also ruled that a trust will be legally recognised once it is registered with the Master and the Letters of Authority issued.

Click here to read the full judgment.