SU 7- TRUST ADMINISTRATION
Trust administration is the core function of trusteeship
Administration of trust property for the benefit of beneficiaries or to attain an
impersonal trust object
Trust admin is subject to supervision and control by the Master and the HC- involves-
Exercise of specific powers and duties arising from common law, legislation and trust
instruments
Golden rules of trust administration-
a) Trustee must exercise independent judgement and discretion
o Except when trustee is required to apply the law or abide by a legal prescript
b) Trustee must give effect to the clear or properly-interpreted directives contained in
the trust instrument
c) Trustee must act with the care, diligence and skill reasonably expected of a person
who manages someone else’s affairs when he/she exercises trustee powers and
performs trustee duties
d) Co-trustees must always act jointly unless trust instrument directs otherwise
PUBLIC SUPERVISION AND CONTROL OF TRUSTEES AND TRUST ADMIN
MASTER OF THE HIGH COURT
Master is a public official with an array of functions, duties and powers iro-
Trusts
Deceased estates
Insolvent estates
Tutors
Curators
Administration of the Guardian’s fund
Master is appointed by the Minister of Justice and Constitutional Development
Chief Master is also appointed who provides advice and guidance to the Master
And also exercises control over the Master
Master has administrative and substantive powers over trustees
a) Master’s jurisdiction
Section 3- regulates the jurisdiction of a Master over a specific trusts and its trustees
Trust property of testamentary trust-
o Jurisdiction lies with the Master in whose office the relevant testamentary
writing or a copy thereof was registered and accepted
Any other trust property-
, o Jurisdiction lies with the Master in whose area of appointment the greater or
greatest portion of that property is situated
o Subject to the proviso that a Master who has exercised jurisdiction shall
continue to have jurisdiction
Allows a Master to assume jurisdiction over trust property- on the written application
by any person with an interest in that property and with consent of Master who has
such jurisdiction
No act performed by a Master who in good faith believed that he had jurisdiction
shall be invalid merely because it should have been performed by another Master
More than one Master exercised jurisdiction iro same trust property without
prejudice
o Property shall be administered or disposed of under jurisdiction of Master
who first exercised jurisdiction
o Authorisation or appointment made by other Master shall be cancelled
b) The reporting of irregularities to the Master
Trustee is under common law duty to maintain a trust’s accounting books
Act not require that trust accounts must be audited
But trust instrument can impose the duty on trustee to subject that trust’s accounts
to regular audits
Section 15-
If auditor notices any irregularity regarding trust admin- must report it in writing to
the trustee
Trustee has 1 month to rectify the irregularity
If trustee fails to rectify- auditor must report the irregularity in writing to the Master
Master can then take appropriate steps against the recalcitrant trustee
c) Master’s power to hold a trustee accountable
Section 16- Master has extensive power to ensure trustees’ accountability
Trustee shall, at the written request of the Master, provide him with any book,
record, account or document relating to his admin or disposal of the trust property
Trustee shall answer any question posed to him by the Master honestly and
truthfully
Master may, if he deems it necessary, cause an investigation to be carried out into
the trustee’s admin and disposal of trust property
Master shall make any order he deems fit in connection with the costs of an
investigation
Section 19-
Master can apply for court intervention if the trustee fails to comply with Master’s
request
, d) Judicial review of the Master’s action
Section 23-
Any person aggrieved by an authorisation, appointment or removal of a trustee by
the Master
Or any decision, order or direction of the Master
May apply to court for relief
Court has the power to consider the merits, take evidence and make any order it
deems fit
Fesi v Trustees Elect of the Ndabeni Communal Property Trust- SCA
Any decision, order or direction of the Master is open to judicial review by the HC
Court may rehear the dispute regarding the Master’s decision, order or direction de
novo- as a new case
Section 23 applies to Master’s decision that is reviewable AND the court can
reconsider the substantive justification behind Master’s decision
Makgoba v Ledwaba- SCA
Litigant cannot invoke S 23 for the first time in appeal proceedings
The evidence and merits of a challenge on basis of S 23 must have been adjudicated
in the court of first instance before an appeal against that court’s findings may be
lodged
THE HIGH COURT
Has common law jurisdiction to intervene in trust admin to ensure that a trustee administers
trust properly
Has the power to-
Vary trust provisions
Order a trustee to comply with the Master’s request to account for the trustee’s trust
admin; or to perform a duty imposed on trustee
Remove a trustee from trust office
Review any appointment, authorisation or removal of trustee by Master
Review any other decision, order or direction of Master
In judicial review- consider merits of case, take evidence and make any order it
deems fit
TRUSTEE’S DUTIES REGARDING TRUST ADMIN
Trustee’s duties originate from 3 sources-
1. Trust instrument
2. Statute
3. Common law
Trust administration is the core function of trusteeship
Administration of trust property for the benefit of beneficiaries or to attain an
impersonal trust object
Trust admin is subject to supervision and control by the Master and the HC- involves-
Exercise of specific powers and duties arising from common law, legislation and trust
instruments
Golden rules of trust administration-
a) Trustee must exercise independent judgement and discretion
o Except when trustee is required to apply the law or abide by a legal prescript
b) Trustee must give effect to the clear or properly-interpreted directives contained in
the trust instrument
c) Trustee must act with the care, diligence and skill reasonably expected of a person
who manages someone else’s affairs when he/she exercises trustee powers and
performs trustee duties
d) Co-trustees must always act jointly unless trust instrument directs otherwise
PUBLIC SUPERVISION AND CONTROL OF TRUSTEES AND TRUST ADMIN
MASTER OF THE HIGH COURT
Master is a public official with an array of functions, duties and powers iro-
Trusts
Deceased estates
Insolvent estates
Tutors
Curators
Administration of the Guardian’s fund
Master is appointed by the Minister of Justice and Constitutional Development
Chief Master is also appointed who provides advice and guidance to the Master
And also exercises control over the Master
Master has administrative and substantive powers over trustees
a) Master’s jurisdiction
Section 3- regulates the jurisdiction of a Master over a specific trusts and its trustees
Trust property of testamentary trust-
o Jurisdiction lies with the Master in whose office the relevant testamentary
writing or a copy thereof was registered and accepted
Any other trust property-
, o Jurisdiction lies with the Master in whose area of appointment the greater or
greatest portion of that property is situated
o Subject to the proviso that a Master who has exercised jurisdiction shall
continue to have jurisdiction
Allows a Master to assume jurisdiction over trust property- on the written application
by any person with an interest in that property and with consent of Master who has
such jurisdiction
No act performed by a Master who in good faith believed that he had jurisdiction
shall be invalid merely because it should have been performed by another Master
More than one Master exercised jurisdiction iro same trust property without
prejudice
o Property shall be administered or disposed of under jurisdiction of Master
who first exercised jurisdiction
o Authorisation or appointment made by other Master shall be cancelled
b) The reporting of irregularities to the Master
Trustee is under common law duty to maintain a trust’s accounting books
Act not require that trust accounts must be audited
But trust instrument can impose the duty on trustee to subject that trust’s accounts
to regular audits
Section 15-
If auditor notices any irregularity regarding trust admin- must report it in writing to
the trustee
Trustee has 1 month to rectify the irregularity
If trustee fails to rectify- auditor must report the irregularity in writing to the Master
Master can then take appropriate steps against the recalcitrant trustee
c) Master’s power to hold a trustee accountable
Section 16- Master has extensive power to ensure trustees’ accountability
Trustee shall, at the written request of the Master, provide him with any book,
record, account or document relating to his admin or disposal of the trust property
Trustee shall answer any question posed to him by the Master honestly and
truthfully
Master may, if he deems it necessary, cause an investigation to be carried out into
the trustee’s admin and disposal of trust property
Master shall make any order he deems fit in connection with the costs of an
investigation
Section 19-
Master can apply for court intervention if the trustee fails to comply with Master’s
request
, d) Judicial review of the Master’s action
Section 23-
Any person aggrieved by an authorisation, appointment or removal of a trustee by
the Master
Or any decision, order or direction of the Master
May apply to court for relief
Court has the power to consider the merits, take evidence and make any order it
deems fit
Fesi v Trustees Elect of the Ndabeni Communal Property Trust- SCA
Any decision, order or direction of the Master is open to judicial review by the HC
Court may rehear the dispute regarding the Master’s decision, order or direction de
novo- as a new case
Section 23 applies to Master’s decision that is reviewable AND the court can
reconsider the substantive justification behind Master’s decision
Makgoba v Ledwaba- SCA
Litigant cannot invoke S 23 for the first time in appeal proceedings
The evidence and merits of a challenge on basis of S 23 must have been adjudicated
in the court of first instance before an appeal against that court’s findings may be
lodged
THE HIGH COURT
Has common law jurisdiction to intervene in trust admin to ensure that a trustee administers
trust properly
Has the power to-
Vary trust provisions
Order a trustee to comply with the Master’s request to account for the trustee’s trust
admin; or to perform a duty imposed on trustee
Remove a trustee from trust office
Review any appointment, authorisation or removal of trustee by Master
Review any other decision, order or direction of Master
In judicial review- consider merits of case, take evidence and make any order it
deems fit
TRUSTEE’S DUTIES REGARDING TRUST ADMIN
Trustee’s duties originate from 3 sources-
1. Trust instrument
2. Statute
3. Common law
