In a recent judgement by the Supreme Court of Appeals (SCA), the court held that the Master of the High Court (the Master) is entitled to refuse to authorise trustees under section 6 of the Trust Property Control Act, 57 of 1988, (the Act) if there is reason to doubt the proper appointment of the trustee(s). Trustees are appointed under a trust deed, by court order, or by the Master acting under specific powers extended in section 7 of the Act. After appointment trustees can only act as such once properly authorised by the Master under section 6 of the Act.
In an appeal from a judgement of the Western Cape High Court (WCHC), the SCA overturned the WCHC’s order to the Master to issue letters of authority to trustees elected at an annual general meeting of a communal property trust. The trust was set up after a successful land restitution claim and was by all accounts dysfunctional for more than a decade. The trust deed required that a board of trustees be elected annually at an annual general meeting to which all members of the community, which brought the successful land claim, must be invited. After a dispute about the invitations and the election process the elected trustees approached the WCHC for an order compelling the Master to issue letters of authority in their favour. The WCHC issued the order. The Master’s refusal was based on the disputes and questions about the legality of the election.
The SCA also expressed strong views about the motivation for the litigation, as it appeared to have been driven by a desire to finalise the sale of the trust’s immovable property. The respondents in the application in the WCHC, and appellants in the appeal against the WCHC’s order, alleged serious irregularities in the property deal and in the convening and conducting of the annual general meeting where the trustees were elected. Due to this the Master refused to authorise the trustees and indicated that she preferred the appointment of independent trustees pending the regularisation of the situation. The appeal was upheld.