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IOL – Court case highlights key issues when creating a testamentary trust

In a recent court case, Van Rensburg v Van Rensburg NO and Others (March 24) issues around a testamentary trust were highlighted. As the will of a deceased person forms the trust instrument, no further trust instrument is required to be lodged with the Master of the High Court.

A will typically does not provide detailed provisions of how a trust should be administered. This often leads to issues arising at a later stage.

In this case, the joint will of the mother and father provided that on the death of the father a testamentary trust had to be established for the benefit of the mother. The trustees had to apply the income and the capital of the trust for the maintenance and benefit of the mother until her death. On her death, the trust should have terminated and the trust assets divided equally among the four children, or the survivors of them.

Written by Phia van der Spuy (FISA member and FPSA®) for IOL – read the full article here.

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